Crude oil price on June 15
Brent crude futures fell $3.58, or 4.10%, to $83.75 a barrel, while U.S. West Texas Intermediate crude declined $4.01, or 4.72%, to $80.87. Both benchmarks had already fallen more than 3% on Friday.
“The Deal with the Islamic Republic of Iran is now complete,” Trump wrote on his Truth Social platform. “Ships of the world, start your engines. Let the oil flow”, he added. Trump said on Sunday that vessels would be able to pass through the Strait of Hormuz “toll free” and that a U.S. naval blockade of Iranian ports would be lifted.
Pakistan, which has acted as a mediator between the two sides, said the U.S. and Iran would sign a memorandum of understanding in Switzerland on Friday.
Iran’s semi-official Mehr news agency reported that the draft agreement includes a provision to reopen the Strait of Hormuz within 30 days under arrangements overseen by Iran. The country’s Deputy Foreign Minister Kazem Gharibabadi said negotiations on a broader agreement would continue during a proposed 60-day ceasefire period.
The deal also includes Lebanon, a region that has remained one of the most contentious issues in the negotiations, with Israel and Hezbollah continuing to exchange attacks despite repeated calls from Trump and others to halt hostilities in recent weeks.
The closure of the Strait of Hormuz for more than three months has removed millions of barrels of oil and gas supply from global markets. The waterway is a key route for roughly one-fifth of the world’s oil and liquefied natural gas shipments.
Read More: Uday Kotak questions SpaceX valuation, says only time will tell if we’re in ‘mega bubble’
Where are prices headed?
Market participants are now closely monitoring how quickly producers in the Middle East can restore oil output and exports after wartime disruptions. Investors are also watching whether shipping traffic gradually returns to the region.Analysts cautioned that even if the ceasefire holds, shipping through the Strait of Hormuz may take months to normalize. They added that any damage to energy infrastructure could further delay the recovery process.
Last month, Saudi Aramco Chief Executive Officer Amin Nasser warned that disruptions in the Strait of Hormuz could postpone stability in global oil markets until 2027. He said prolonged interruptions could affect nearly 100 million barrels of oil supply every week. Saudi Aramco remains the world’s largest oil producer.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
