Oil Prices Decline as Markets Monitor Progress in U.S.-Iran Negotiations
Oil prices moved lower on Wednesday as investors searched for additional signals surrounding ongoing negotiations between the United States and Iran. Optimism over diplomatic progress and potential improvements in global oil supply weighed on crude markets.
Brent crude futures for July delivery, considered the international benchmark for oil prices, fell 2.5% to $109.25 per barrel by 04:44 ET (08:44 GMT). Meanwhile, U.S. West Texas Intermediate (WTI) crude dropped 1.9% to $102.35 per barrel. Both benchmarks had already recorded losses of roughly 1% during Tuesday’s session.
Tankers Leave Strait of Hormuz, Raising Supply Hopes
Market sentiment improved after reports indicated that oil tankers had resumed movement through the Strait of Hormuz, one of the world’s most critical energy shipping routes.
According to Reuters, citing LSEG and Kpler shipping data, two Chinese-flagged supertankers carrying crude oil exited the Strait of Hormuz on Wednesday. Additionally, the South Korean-flagged Very Large Crude Carrier Universal Winner was also reported leaving the narrow passage near Iran’s southern coastline.
The waterway has experienced severe disruption since the escalation of the U.S.-Israel conflict involving Iran in late February. Renewed tanker movement has strengthened expectations that global oil supply flows may gradually recover.
Donald Trump Signals Possible End to Iran Conflict
U.S. President Donald Trump stated on Tuesday evening that the conflict involving Iran could conclude “very quickly.” Earlier in the week, Trump noted he had delayed a planned military action and suggested diplomatic discussions with Tehran were progressing positively.
Vice President JD Vance also expressed optimism, indicating that Iran appeared willing to negotiate and potentially reach an agreement.
Iran Pushes New Peace Proposal
Iran reportedly introduced a new peace proposal earlier this week calling for an end to military hostilities, the withdrawal of U.S. forces from the region, and compensation for war-related damages, according to state media reports.
Previous proposals from Tehran had largely been rejected by Washington, which continues to prioritize limiting Iran’s nuclear capabilities as a central requirement in any future agreement.
U.S. Oil Inventory Data in Focus
Traders are now turning attention toward upcoming U.S. crude inventory figures, which could provide further insight into supply conditions amid continued geopolitical uncertainty.
Recent data from the American Petroleum Institute (API) showed an unexpected drawdown of 9.1 million barrels last week, significantly exceeding market forecasts of a 3.4 million barrel decline. Historically, API figures often provide an indication of trends later confirmed by official government inventory reports.
Strategic Petroleum Reserve Releases Continue
U.S. oil inventories are expected to have decreased sharply in recent weeks as exports increased to offset global supply disruptions.
The Trump administration has authorized the release of 172 million barrels from the Strategic Petroleum Reserve in an effort to stabilize markets and reduce supply pressures linked to tensions involving Iran.
