Oil prices reached their lowest levels in nearly four months as shipping traffic through the Strait of Hormuz increased. Brent crude dropped to $73.87 per barrel, nearing levels seen before the recent conflict. U.S. crude fell to $70.34 per barrel.
Tanker traffic normalized following a memorandum of understanding signed between the U.S. and Iran last week. The agreement to reopen the waterway eased market fears of prolonged supply disruptions from the Persian Gulf. This de-escalation removed the high risk premium that previously inflated global energy prices.
Shipping firms noted that uncertainty remains until parties reach a final settlement. The price trend directly impacts energy ETFs and the valuations of oil and gas producers. Sustained lower prices also affect earnings for service companies and midstream operators.