Global oil prices fell on Thursday to their lowest levels since late February as improving crude flows through the Strait of Hormuz eased concerns over supply disruptions caused by the recent U.S.-Iran conflict.
Brent crude futures for August delivery dropped 1.5% to $72.66 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 1.2% to $69.50, with both benchmarks extending losses recorded earlier in the week.
Speaking at an energy forum, U.S. Energy Secretary Chris Wright said oil shipments through the Strait of Hormuz had nearly returned to pre-conflict levels, with more than 20 million barrels moving through the vital waterway over the past 24 hours.
Although Wright noted that full normalization could take several weeks due to the need for mine-clearing operations, traders viewed the recovery in shipping activity as a sign that Middle East supply risks are fading.
Market sentiment was further pressured by expectations that Iran could increase crude exports following a temporary easing of U.S. sanctions, while physical crude cargo prices weakened across global markets.
Analysts at Goldman Sachs said any rise in Iranian production is likely to be limited, adding that China will remain the primary buyer of Iranian oil as European and British sanctions remain in force.
The decline in prices follows last week’s ceasefire agreement that ended the U.S.-Israeli conflict with Iran and reopened shipping routes through the Strait of Hormuz, a key artery for global energy trade.
UBS lowered its Brent crude price forecasts through mid-2027, citing improving supply conditions and reduced geopolitical risk in the Gulf region.
Meanwhile, concerns over OPEC cohesion resurfaced after sources said Iraq is considering all options, including a possible exit from the producer group, if its production quota is not significantly increased.
Separately, geopolitical tensions persisted as Ukrainian President Volodymyr Zelenskiy said Kyiv’s forces struck an oil depot in Russia’s Krasnodar region and two refineries in the Ufa region, targeting Moscow’s energy infrastructure.