Oil prices continue to decline as more shipments exit through the Strait of Hormuz
Oil prices continued to decline today, Thursday, approaching levels before the outbreak of the Iran war, as expectations of increased supplies from the Middle East eased concerns about demand.
And Brent crude futures for spot delivery in August rose by $1.22, or 1.65%, to reach $72.52 per barrel by 03:37 GMT, while the price of US West Texas Intermediate crude fell by $1.02, or 1.45%, to reach $69.32 per barrel. Both contracts recorded their lowest levels since February 27.
US Energy Secretary Chris Wright said at a forum held on Wednesday that oil flows through The Strait of Hormuz is approaching levels before the outbreak of the Iran war, saying that at least 20 million barrels have exited the strait in the past 24 hours. He added that it would take a few weeks to return to full normalcy due to the need to remove mines from the strait.
High supply from the Middle East, coupled with expectations of increased sales of Iranian oil after US sanctions were temporarily lifted, led to a decline in the price of crude oil shipments around the world.
A tentative agreement reached last week allowed the end of The US-Israeli-Iranian war, which began on February 28, with the resumption of shipping traffic through the Strait of Hormuz.
The agreement set a 60-day period for negotiations to address more complex issues, including the Iranian nuclear program. Wright stated that oil will continue to flow through the Strait even if the agreement does not hold, and that Iran will not be able to close it again.
On Wednesday, the Sultanate of Oman opened temporary corridors to facilitate the departure of oil tankers from the Strait of Hormuz, where they "International Maritime Organization" The Omani authorities coordinate the navigation movement.
Analysts expect "Macquarie" Oil prices will quickly return to normal levels, to pre-war levels, as supply chains adapt and the Strait of Hormuz reopens.
They expect the price of Brent crude to average $67 and West Texas Intermediate crude to average $62 per barrel in the third quarter, down from the second quarter average of $94 and $87 per barrel.
- For more: Follow Khaleejion 24 Arabic, Khaleejion 24 English, Khaleejion 24 Live, and for social media follow us on Facebook and Twitter
