Meanwhile, various initiatives continue to soften the impact of Iranian aggression: File Image/Pixabay

With no end in sight either of Iran hostilities against Middle East neighbours or the capabilities of various entities to weather the aggression, oil on Thursday held steady as investors seemed to endorse U.S. president Donald Trump temporarily lifting sanctions on diesel from Russia to ease surging global prices.

As of 1614 GMT, Brent was up 2 cents at $106.08 per barrel, and West Texas Intermediate rose $2.96 to $98.05 per barrel.

WTI was supported by crude inventories falling by 8.6 million barrels to 415.6 million barrels in the week ended October 9, according to the Energy Information Administration.

Trading confidence overall was supported by the International Energy Agency on Thursday agreeing to release over 20 million barrels of diesel to the market ASAP as well as any oil remaining from an emergency reserves release pledged in March to boost supply.

Spain will also release 4.4 million barrels from strategic reserves this month.

As for the sanctions lifted on Russian diesel, a U.S. official said new talks centre on the possibility of Washington allowing “legal oil” to flow on previously sanctioned vessels; but relieving sanctions on the shadow fleet would not help Russia move oil or oil products.

Meanwhile, in the aftermath of Iran-backed Houthis sinking a container ship and a dry bulk carrier near the Strait of Hormuz as well as Iran bragging about stepping up strikes in response to the U.S.’s blockade of its ports, media reported  that the U.S. military has formulated plans for new strikes on Iran that include the largest non-nuclear explosive device in U.S. arsenal.

MUFG analysts said in a note, "The ongoing conflict between Saudi Arabia and the Houthis is keeping a geopolitical premium in oil markets, but energy infrastructure has not been attacked in the last several days."

However, complicating matters on a global stage is Ukraine president Volodymyr Zelenskyy, who, after expressing anger at a "dangerous" withdrawal of U.S. intelligence, resumed his attacks on Russian refineries with a strike on a plant in the Ryazan region.

In other oil news on Thursday, vessel tracking data by Vortexa showed that waters near the Strait of Hormuz are so cluttered with ship-to-ship transfers to keep oil flowing out of the Persian Gulf that operations are expanding into India’s West Coast.

The data revealed that 82 cargoes, or about 680,000 barrels per day (bpd), were transferred onto larger ships in the Indian Gulf of Kutch in September.