Oil prices declined in Asian trading Thursday after surging nearly 4% in the previous session, as markets balanced renewed tensions between Washington and Tehran against indications that diplomatic efforts to end the conflict remained possible. At 20:32 ET (00:32 GMT), November Brent futures fell 1% to $102.10 a barrel, while West Texas Intermediate (WTI), the U.S. crude benchmark, dropped 0.7% to $91.50. Brent had settled nearly 4% higher Wednesday and WTI had gained nearly 2%. The rally followed Iranian President Masoud Pezeshkian's address to the United Nations General Assembly, where he said Iran would not yield to U.S. pressure but remained open to diplomacy. The comments came a day after U.S. President Donald Trump warned he could "annihilate" Iran if no deal to end the conflict was reached. Tehran was reviewing Washington's response to an Iranian proposal to end hostilities, a senior Iranian official told Reuters, although major differences remained. Discussions have included potentially reopening the Strait of Hormuz, a vital oil-shipping route, and ending a U.S. naval blockade on Iran. The waterway normally carries roughly one-fifth of global oil and gas shipments, but Iranian security chief Mohsen Rezaei said it would remain closed until Tehran's conditions were satisfied. Increased Gulf supply also constrained crude's gains: Saudi Arabia restarted its East-West pipeline to the Red Sea, while Iraq raised exports and expects to increase shipments through Turkey. U.S. diesel futures fell sharply Wednesday after a report that the White House was considering a 90-day diesel-export ban; the White House later called the report "fake news." U.S. crude inventories increased by 3 million barrels to 426.4 million in the week ended Sept. 18, defying analysts' forecast for a 640,000-barrel draw. Gasoline inventories fell 1.7 million barrels and distillate inventories, including diesel and heating oil, declined 400,000 barrels. The figures are especially relevant to diesel markets, where supplies remain tight despite higher crude stocks.