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Crude oil falls as Strait of Hormuz peace hopes resurface
Brent crude dropped 5.0% to $79.5 per barrel, while WTI futures fell 5.1% to $75.81, as US officials signaled talks to reopen the strait could be reached soon.
Crude oil retreated sharply in Tuesday trading as renewed optimism about a potential Middle East peace agreement eased concerns about supply disruptions tied to the Strait of Hormuz, according to LiveMint Markets. The move reversed an earlier surge, with oil prices having been up as much as 3% earlier in the session.
LiveMint Markets reported that US Treasury Secretary Scott Bessent told CNBC the US is in talks with Iran and suggested there is a chance a deal could be reached within a day or two to reopen the strait. Bessent said the expectation is for freedom of movement, a comment that helped restore investor confidence and contributed to the reversal in crude prices.
Brent crude fell 5.0% to $79.5 per barrel, while US WTI crude futures dropped 5.1% to $75.81 per barrel. LiveMint Markets noted that Brent has swung widely between $72 and $102 per barrel since July as markets focused on uncertainty about when normal tanker operations could resume through the Persian Gulf following the conflict with Iran.
The report also highlighted that similar de escalation hopes had emerged multiple times since the conflict began in late February. It cited broader statements from US officials about negotiations and added that Reuters and AFP reporting around the situation, including reports of a projectile hitting a cargo ship in the strait, underscored the fragile security environment.
Latest closeWTI crude $80.00 ▼5.5%|Brent $83.63 ▼7.2%