Diplomatic efforts to reopen the Strait of Hormuz ease supply concerns, pushing oil prices down 10% for the week.
West Texas Intermediate crude fell below $76.00 on Friday, extending a 10% weekly decline as markets assess ongoing negotiations to reopen the Strait of Hormuz. Investors are pricing in reduced geopolitical risks after reports of Iran-Oman talks aimed at easing tensions in the critical oil transit route.
Earlier concerns arose after Iran suggested imposing fees of 5-7% on cargo passing through Hormuz, a move the U.S. opposes. President Donald Trump downplayed risks, calling the strait “sort of open” under U.S. control but warned of potential Iranian actions. Analysts note global oil inventories are depleting at 2-5 million barrels per day, limiting buffers against prolonged disruptions.
The pullback reflects shifting sentiment as diplomatic progress tempers fears of supply constraints in the near term.