US Iran peace deal: Oil prices slipped on Wednesday, 24 June, as investors closely monitored developments related to tanker movements and shipping operations through the Strait of Hormuz.
Global benchmark Brent crude futures for August delivery declined 0.45% to $76.73 per barrel after falling 1.1% in the previous session, while US West Texas Intermediate (WTI) crude futures for August fell 0.48% to $72.86 a barrel.
What’s weighing on crude oil prices?
Washington and Tehran have indicated preliminary headway in efforts to end the conflict that erupted in late February, though negotiations are expected to be lengthy and both sides continue to present differing accounts of the discussions. Iran and Oman have also begun working on an agreement governing the administration of the Strait of Hormuz, including transit charges, amid ongoing concerns that Tehran could impose additional fees.
Shipping activity through the strategic waterway appears to be normalizing, with vessels increasingly keeping their satellite tracking systems active, reflecting improved confidence among shipowners. The International Maritime Organization has likewise reported receiving safety assurances that have enabled hundreds of ships to leave the Persian Gulf.
In the US, the Republican-controlled Senate on Tuesday approved a resolution seeking to end American involvement in the conflict with Iran, marking a rare symbolic challenge to President Donald Trump. Although the measure is unlikely to alter the administration’s policy, it underscores the limited domestic backing for the military campaign.
Oil prices have fallen more than one-third from the peaks reached during the conflict, supported by expectations of higher crude supply. As part of the diplomatic process, the US has temporarily permitted purchases of Iranian oil, helping exporters re-engage with major Asian refiners.
Meanwhile, oil-producing nations in the Persian Gulf are moving swiftly to restore exports. According to the International Energy Agency, the United Arab Emirates has already recovered to nearly 85% of its pre-war production levels, demonstrating the region’s capacity to rapidly increase output. Kuwait has withdrawn its force majeure measures, while Iraq is also stepping up production.
(With inputs from Bloomberg)
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