Oil prices dropped to their lowest point since early March on 18 June following the announcement of an interim agreement aimed at ending the US-Iran conflict and reopening the Strait of Hormuz.
The deal, which includes provisions to ease sanctions on Iran, prompted market expectations of increased oil supply
As of 08:11 GMT, Brent crude futures had fallen by $1.59, or 2%, to $77.96 a barrel (bbl). US West Texas Intermediate (WTI) crude had dropped by $1.83, or 2.38%, to $74.96/bbl, reported Reuters. This was Brent’s lowest mark since 2 March, the first trading day after the initial US-Israeli strikes on Iran, while WTI was at its lowest level since 4 March.
Energy markets continued to react to the expectation of a quicker resumption of Iranian oil exports. The 14-point memorandum sets out a 60-day period for negotiations, during which Iran has agreed to allow toll-free passage through the Strait of Hormuz. Full traffic through the key shipping lane, used for oil and gas exports, is to be restored within 30 days under the agreement.