Oil Prices Hit Three-Month Low Amid Strait of Hormuz Supply Prospects

Oil prices plummeted to a three-month low, influenced by potential supply resumption through the Strait of Hormuz and diminished physical demand. The preliminary deal to end the Iran conflict prompted price drops, with U.S. and Iran beginning talks in Switzerland. Shippers await safety assurances to resume normal operations.

Oil prices plummeted to fresh three-month lows on Tuesday, impacted by the anticipation of resumed supplies through the strategic Strait of Hormuz, alongside weakening physical demand and limited information on a preliminary U.S.-Iran deal to cease conflicts.

By 1034 GMT, Brent crude futures had fallen $1.70, reaching $81.47 a barrel, with U.S. West Texas Intermediate similarly dipping. This decline follows U.S. President Trump's announcement of an interim deal with Iran, although comprehensive details remain scant.

The conflict had previously led to the closure of the Strait, a crucial oil transit route. While few tankers have resumed crossing, shippers await safety reassurances, including mine clearance. Meanwhile, U.S. military operations discreetly support Gulf energy flow continuity.​