BEIJING: Global oil prices continued to fall on Thursday, moving closer to levels seen before the recent conflict in the Middle East, as shipping activity through the Strait of Hormuz resumed following an initial agreement aimed at ending the US-Israeli war with Iran.
Brent crude for August delivery dropped 40 cents, or 0.54%, to $73.34 per barrel, while US West Texas Intermediate (WTI) crude fell 27 cents, or 0.38%, to $70.07 per barrel. Market analysts noted that the decline reflected easing concerns over oil supplies from the region.
Brent crude for September delivery traded slightly higher than the August contract, indicating that traders see sufficient short-term supply. Analysts said markets were surprised by the speed of the price decline, as expectations for the return of Middle Eastern oil exports improved faster than anticipated.
Oil prices had already fallen sharply on Wednesday, with both Brent and WTI losing nearly $3 per barrel. US Energy Secretary Chris Wright said shipping through the Strait of Hormuz had nearly returned to pre-conflict levels, with more than 20 million barrels of oil passing through the route in the past 24 hours.
Although full normalization may take several weeks due to ongoing demining efforts, tanker traffic has resumed under the temporary ceasefire arrangement. Traders largely ignored a significant drop in US crude inventories, focusing instead on developments in the Strait of Hormuz and regional diplomacy.
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