Oil prices fell for a third straight session on Thursday after Qatar said negotiations between the United States and Iran had made progress on issues linked to the Strait of Hormuz, easing concerns over disruptions to global crude supplies.
Brent crude dropped 0.9% to $70.91 a barrel, while U.S. West Texas Intermediate fell 0.9% to $67.99, with both benchmarks touching their lowest levels since late February as more oil shipments resumed through the strategic waterway.
Qatar’s foreign ministry said the discussions yielded positive progress on matters related to the June ceasefire memorandum, although the two sides have yet to reach a broader and lasting peace agreement.
UBS analyst Giovanni Staunovo said the return of previously delayed tanker traffic through the Strait of Hormuz was adding near-term supply to the market, putting downward pressure on crude prices.
Reflecting the improved supply outlook, UBS cut its Brent crude price forecasts for the third quarter, fourth quarter of 2026 and 2027, citing the U.S.-Iran understanding and increased oil flows through the strait.
HSBC said the market should gradually absorb the additional Middle Eastern crude through inventory rebuilding after the International Energy Agency ends its strategic oil stock releases in July, adding that Brent could recover towards $80 a barrel once the temporary supply surplus fades.
Attention is also turning to Sunday’s meeting of OPEC+, where producers are widely expected to approve another increase in oil output targets for August, potentially adding further supply to the market.
Separately, Ukraine’s military said it had struck the Lukoil-Nizhegorodnefteorgsintez oil refinery in Russia’s Nizhny Novgorod region, highlighting that geopolitical risks to energy infrastructure remain despite easing tensions in the Gulf.
Iran, meanwhile, continues to seek international recognition of its authority over the Strait of Hormuz and its ability to levy fees on vessels using the route, according to two senior Iranian sources.
The combination of improving Middle East supply prospects, expectations of higher OPEC+ production and ongoing geopolitical developments kept oil markets under pressure as traders assessed the outlook for global crude balances.