Oil prices saw minimal change as VP Vance reported a significant increase in tanker traffic through the Strait of Hormuz. This follows a US-Iran deal to end a conflict, which includes lifting a naval blockade and allowing toll-free transit. Analysts remain cautious about the long-term impact on supply disruptions.
Oil prices fell Thursday after VP JD Vance stated over 12 million barrels of oil crossed the Strait of Hormuz overnight, a high since the conflict began. Brent crude futures dropped 1.8% to $78.11, and WTI futures fell 2% to $75.27. The US and Iran signed a deal to end the war, allowing ships transit without tolls for 60 days and lifting the US naval blockade.
Oil prices fell Thursday following Vice President JD Vance's statement that over 12 million barrels of oil transited the Strait of Hormuz overnight. This increase in traffic, coupled with a new US-Iran deal easing blockades and tolls, suggests a potential oversupply.
Analysts predict ship traffic through the Strait of Hormuz could reach nearly 50% of prewar levels within a month if a U.S.-Iran deal is implemented. The deal, expected Friday, would open the strait and lift a U.S. naval blockade on Iran, potentially allowing 40 ships daily compared to 100 before conflict.
Iran has blocked tanker traffic through the Strait of Hormuz since the U.S. and Israel started the war in late February, resulting in supply and price shocks.
Iran has blocked tanker traffic through the Strait of Hormuz since the U.S. and Israel started the war in late February, resulting in supply and price shocks.
Baker Hughes is assuming the Strait of Hormuz may not fully reopen for months, with the company guiding that the U.S.-Iran conflict continues through end of June. The closure has impacted 10% of global oil volumes and 20% of global LNG supplies. A Federal Reserve Bank of Dallas survey found 80% of nearly 100 oil and gas executives believe the strait will not reopen until August or later.
Baker Hughes CFO says the Strait of Hormuz will likely not fully reopen for months, with operations not expected until the second half of 2026. A Dallas Fed survey shows nearly 80% of oil and gas executives believe the strait won't reopen until August or later. The closure has impacted 10% of global oil volumes and 20% of global LNG supplies.
The U.S. and Iran have seized multiple commercial ships in the Strait of Hormuz and Indian Ocean this week, escalating naval tensions during an ongoing ceasefire. Brent crude oil has risen above $100 per barrel as tanker traffic through the strategic shipping lane remains near standstill. Iran demands ships obtain permission to transit the strait while the U.S. maintains its blockade of Iranian ports. President Trump ordered the U.S. Navy to kill any boats laying mines.
