Noida, June 25 (APAC Media): Brent and West Texas Intermediate (WTI) crude oil prices eased toward the $70 per barrel level on Thursday after a diplomatic breakthrough between the United States and Iran allowed the resumption of tanker traffic through the Strait of Hormuz, easing concerns over supply disruptions in one of the world’s most critical energy chokepoints.
Brent crude futures, the global benchmark, fell $3.43, or 0.5%, to $73.64 a barrel as of 1446 GMT, while U.S. West Texas Intermediate (WTI) slipped $3.33, or 4.7%, to $69.86 a barrel.
Brent crude and West Texas Intermediate (WTI) extended their losses in early trading as markets responded to reports of a peace agreement allowing commercial vessels to resume normal operations through the strategic waterway.
The Strait of Hormuz, which handles nearly one-fifth of global oil shipments, had experienced restricted movement amid recent tensions in the Middle East, contributing to elevated risk premiums in crude oil prices.
The easing of geopolitical tensions has sharply reversed those gains.
Traders said the reopening of shipping lanes has improved sentiment across energy markets, with tanker activity gradually returning to pre-conflict levels. Industry data showed a rise in vessel movements through the strait over recent days, indicating a gradual normalisation of key supply routes.
Oil prices had earlier surged to multi-month highs amid concerns over prolonged disruption in the region, with Brent briefly topping $120 per barrel during peak uncertainty.
However, recent developments have shifted market focus back to fundamentals, including expectations of improved supply availability and easing logistical constraints.
Analysts said the resumption of shipments through the Strait of Hormuz, along with potential output adjustments by major producers, has reinforced expectations of a near-term surplus in global crude supply.
Several market participants estimate that previously delayed cargoes are now re-entering international markets, adding to downward pressure on prices.
Despite the decline, analysts cautioned that volatility in oil markets remains elevated. While the US–Iran agreement has eased immediate supply risks, the durability of the peace framework and broader geopolitical stability in the region remain uncertain.
Any setback in negotiations or security incidents could swiftly reverse the current downward trajectory in prices.
J.P. Morgan on Wednesday lowered its second-half 2026 Brent crude oil price forecast due to lower-than-expected OECD commercial inventory draws and softer demand for oil.
In the United States, the decline in crude prices is expected to gradually feed through to fuel costs, although retail price adjustments typically occur with a lag. Energy officials and refiners are closely watching whether sustained weakness in crude benchmarks will translate into lower pump prices for consumers in the coming weeks.
Market observers said oil trading is increasingly being driven by expectations of supply recovery rather than geopolitical risk premiums. However, they added that sentiment is likely to remain sensitive to developments in Middle East diplomacy and global production policy decisions in the months ahead.
–ENDS–
Disclaimer: Views expressed are those of experts and do not reflect APAC Media. This is for informational purposes only, not financial advice. We are not responsible for investment decisions. Please consult a qualified financial advisor before investing.
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