Global oil prices tumbled on Thursday, falling back to levels seen before the outbreak of the U.S.-Iran conflict, as traders grew increasingly confident that crude supplies would continue flowing through the Strait of Hormuz.
Brent crude futures for August delivery fell $1.06, or 1.4%, to $72.68 a barrel, while U.S. West Texas Intermediate crude dropped 76 cents, or 1.1%, to $69.58 a barrel.
The decline extends a sharp sell-off that began earlier this week. According to market data tracked by Oilprice.com, crude prices slipped from $76.75 per barrel on Tuesday to $73.50 on Wednesday, erasing much of the war-driven premium that had built up during months of tensions in the Middle East.
Oil markets had surged during the conflict as fears mounted that shipping through the Strait of Hormuz one of the world’s most important energy corridors could be disrupted. Those concerns have now eased following a framework agreement aimed at ending hostilities between the United States, Israel and Iran.
The deal has helped restore confidence in global supply chains, with shipping activity gradually resuming through the strategic waterway.
Adding to downward pressure on prices is the prospect of increased Iranian exports after Washington granted Tehran temporary sanctions relief, allowing the country to expand oil sales during a 60-day negotiation period.
Physical crude cargoes across major markets have already begun reflecting expectations of higher Middle Eastern supply.
Oman also moved to ease congestion in the Strait of Hormuz by opening temporary shipping routes on Wednesday, coordinating vessel movements alongside the International Maritime Organization.
Despite the market’s optimism, traders remain cautious. Analysts say investors are closely watching whether traffic continues to move freely through the strait and whether the fragile diplomatic breakthrough can prevent fresh tensions from erupting across the region.
Speaking earlier this week, U.S. President Donald Trump highlighted the rebound in oil shipments, claiming that a record 19 million barrels of crude passed through the Strait of Hormuz on Monday.
“Oil prices are tumbling down, and the world is a much safer place,” Trump said in a post on social media.
While the agreement has brought immediate relief to energy markets, attention is now shifting to the next phase of negotiations, where Washington and Tehran are expected to tackle more contentious issues, including Iran’s nuclear programme and the long-term security of maritime trade routes.
For now, however, traders appear to be betting that oil will keep flowing and prices will remain under pressure.
