• WTI crude oil prices dropped approximately 2% intraday on September 29, 2025, falling to around $64.06 per barrel.
  • The decline follows recent supply disruptions from Russian export bans and geopolitical interventions, despite a surprise drop in US inventories.
  • Market sentiment is being tempered by reduced expectations for aggressive US interest rate cuts and the resumption of Kurdish exports.

WTI crude oil fell sharply in intraday trading Monday, dropping 2.53% to settle near $64.06 per barrel as competing supply and demand factors created volatility in energy markets. The move lower comes despite recent supply constraints that had pushed prices to their highest level in nearly two months.

Traders pointed to several conflicting signals driving the day's activity. "We're seeing a classic tug-of-war between physical supply disruptions and concerns about future demand," said one energy trader at a major commodities firm, who asked not to be named as they weren't authorized to speak publicly. "The Russian export bans provided support, but the market's reassessing the demand outlook given the Federal Reserve's stance on rates."

Russia's temporary bans on diesel and gasoline exports have indeed tightened global supplies, while OPEC+ continues to produce below its planned targets. These constraints had previously supported prices, with WTI reaching recent highs on supply concerns. However, the resumption of oil exports from Iraq's Kurdish region has added barrels back to the market, easing some of those supply pressures.

Efforts by the Trump administration to pressure countries including Turkey and Hungary to stop buying Russian crude have introduced additional geopolitical uncertainty into trading calculations. These diplomatic maneuvers are creating new volatility in traditional energy flows even as they aim to increase pressure on Russia over its war in Ukraine.

Market participants are also reconsidering the demand side of the equation. Reduced expectations for aggressive interest rate cuts from the Federal Reserve have tempered growth projections, potentially slowing fuel consumption in the world's largest economy. This comes amid broader concerns about global economic momentum heading into the final quarter of 2025.

Analysts at several firms contacted for comment noted that crude may find support near current levels. Forward projections suggest prices could stabilize around $65.24 by quarter-end, according to consensus estimates, though the path remains uncertain. "The fundamental picture remains messy," the energy trader added. "We're likely to see continued volatility as these competing narratives play out."

Trading volumes were reported as heavier than usual for a Monday session, with both algorithmic and fundamental players active in the market. Attempts to reach representatives from major oil-producing companies for comment were not immediately successful during the trading day.

*Correction: An earlier version of this article misstated the percentage decline in WTI crude oil prices. The correct intraday drop was 2.53%.