WTI crude falls to near $70 after Iran war and Strait of Hormuz closure failed to sustain expected price surge.
West Texas Intermediate crude oil dropped below $70 per barrel, defying widespread expectations of a rally to $200 following the Iran war and closure of the Strait of Hormuz. The disruption initially cut 20 million barrels per day from global supply, or one-fifth of daily flows, pushing prices to $120 in early trading.
Analysts had forecast a sustained spike if the crisis lasted three months, but prices reversed despite reduced oil flows persisting. Saudi Arabia diverted 35% of lost supply via pipelines, while China slashed imports by 4 million barrels per day, easing pressure on inventories.
Commercial stockpiles declined as traders anticipated the war’s end and a price drop, accelerating destocking. Global consumption remained stable, further confounding expectations of a prolonged supply crunch.