- Oil prices, including Brent and West Texas Intermediate, have fallen to levels last seen before the US-Iran conflict, extending significant losses from the previous session.
- This decline is largely attributed to the gradual resumption of shipping through the Strait of Hormuz, which has reduced the risk premium that previously inflated crude prices.
- Donald Trump stated that talks with Iran in Qatar regarding denuclearisation were progressing well, following indirect discussions involving his son-in-law Jared Kushner and US special envoy Steve Witkoff.
- These diplomatic efforts aim to reinforce a 60-day truce and restore commercial shipping through the vital Strait of Hormuz, although tanker traffic remains below pre-conflict levels.
- Further bearish signals for the market include a smaller-than-expected draw in US crude inventories and an anticipated production increase from OPEC+ for August.
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