Brent crude slips below key threshold as improving Strait of Hormuz traffic eases supply concerns
International oil prices extended losses on Wednesday, with Brent crude falling below the $75-per-barrel mark and US benchmark West Texas Intermediate (WTI) dropping below $72, as progress in US-Iran peace talks improved market sentiment and reduced fears of supply disruptions.
International oil prices have come under pressure in recent sessions as traders increasingly bet on a diplomatic resolution between Washington and Tehran. Brent crude was trading at $74.75 per barrel at 5:08 PM, while WTI slipped to $71.07 per barrel, both reaching their lowest levels in several months.
The decline in international oil prices reflects easing geopolitical tensions and growing confidence that global energy supplies will remain stable despite recent uncertainty in the Middle East.
Strait of Hormuz Shipping Activity Improves
A key factor behind the decline in international oil prices has been the return of normal shipping activity through the Strait of Hormuz, one of the world’s most important oil transit routes.
Reports indicated that tanker traffic through the strategic waterway has increased significantly following improved security conditions and assurances from maritime authorities. Shipowners have reportedly resumed normal operations, with vessels openly transmitting satellite signals as concerns over maritime risks subside.
The restoration of shipping activity has helped reduce fears of supply disruptions that had previously supported higher international oil prices.
UAE Export Recovery Supports Market
The recovery in regional exports has also contributed to lower international oil prices.
According to estimates, the United Arab Emirates is now exporting oil at nearly 85 per cent of pre-conflict levels, shipping around 60 million barrels from the Persian Gulf in recent weeks.
The rebound in exports has eased concerns about shortages and strengthened expectations that additional supplies could return to the global market if diplomatic progress continues.
Oil Prices Retreat From Conflict Highs
Analysts noted that international oil prices have declined sharply from levels seen during the height of tensions between the United States and Iran.
Brent and WTI crude have both fallen by roughly 40 per cent from their wartime peaks as traders reduce the geopolitical risk premium previously built into energy markets.
The progress in US-Iran negotiations has become one of the main drivers influencing international oil prices, with investors increasingly focusing on the potential for a lasting agreement.
Inventory Concerns Remain
Despite the broader decline in international oil prices, some signs of supply tightness remain in the United States.
Industry data showed that crude inventories at Cushing, Oklahoma—the delivery hub for WTI futures—fell by around one million barrels in the latest reporting period. Analysts said continued declines in inventories could provide some support to prices in the near term.
Outlook for International Oil Prices
Market participants will continue monitoring developments in US-Iran negotiations, shipping activity in the Persian Gulf and upcoming inventory reports.
While improving geopolitical conditions have pushed international oil prices lower, analysts expect volatility to persist as traders assess the pace of export recovery and global demand trends. For now, Brent remains below the key $75 threshold, while WTI continues to trade near multi-month lows amid expectations of stronger supply and easing geopolitical risks.
