Noida, Aug 24 (APAC Media): Oil prices fell sharply on Monday after Iran allowed several Iraqi oil tankers to pass through the Strait of Hormuz following recent talks between the two countries.
Despite the decline, crude prices remained well above last week’s levels and could see further gains. The market is also bracing for tighter U.S. sanctions on Iran, which could disrupt regional oil flows and further constrain Middle Eastern supplies.
Brent crude futures fell 1.77% to $91.08 a barrel by 12:10 PM (16:10 GMT) on Monday, pulling back after gaining more than 5% over the past two weeks. U.S. West Texas Intermediate crude futures declined 2% to $85.30 a barrel.
The decline came as Iran allowed some Iraqi oil tankers to pass through the Strait of Hormuz, offering a limited sign of easing tensions around the key shipping route. Iranian media reported that the move followed repeated requests from Baghdad, although the number of vessels involved and the volume of oil transported remained unclear.
At the same time, the United States was preparing what it described as its toughest sanctions package yet against Iran. Treasury Secretary Scott Bessent said in a Financial Times opinion piece that an “economic D-Day†was approaching for Tehran. He was expected to detail the measures at a press conference at 14:00 ET (18:00 GMT) on Monday.
Bessent’s comments followed warnings from several U.S. officials, including President Donald Trump, of intensified economic pressure on Iran as the standoff over the Strait of Hormuz continued.
Iranian officials have threatened to halt all oil exports through the waterway and elsewhere in the Persian Gulf if the economic pressure continues. Mohsen Rezaee, Secretary of Iran’s National Security Council, said not a single drop of oil would be exported through the region under continued economic warfare. Tehran has also warned neighbouring Gulf states against cooperating with Washington.
Shipping through the Strait of Hormuz slowed sharply last week as tensions escalated. The waterway had been effectively closed to much commercial traffic following the outbreak of U.S.-Iran hostilities in February, disrupting a route that previously handled about 20% of global oil supplies.
The partial passage of Iraqi tankers suggests that some traffic may be resuming, although uncertainty remains high. Oil markets are still pricing in the risk of further supply disruptions as Washington signals that the conflict could persist.
Concerns are also growing that the confrontation could spread beyond the Gulf. Yemen’s Iran-backed Houthi group has announced a naval blockade targeting Saudi Arabia, raising the prospect of wider disruption to oil and shipping routes across the region.
–ENDS–
Disclaimer:Â This article is for informational purposes only and is based on publicly available information. APAC Media is not responsible for investment decisions or losses. Please conduct your own research or consult a financial adviser before investing.
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