Brent crude futures rose by 50 cents or 0.69% to $73.45 a barrel, while U.S. West Texas Intermediate (WTI) crude climbed 63 cents, or 0.91%, to $70.13 a barrel on Tuesday. The increase comes as U.S. envoys Jared Kushner and Steve Witkoff arrived in Doha for high-level talks, though Iran and Qatar indicated meetings would occur with mediators rather than directly with Iranian officials.
Brent crude experienced a significant drop of around $45 a barrel between the first and second quarters of this year, marking its largest quarterly loss since the 2008 financial crisis. Similarly, U.S. crude futures fell by approximately $31, their largest quarterly decline since the 2020 pandemic-induced demand collapse. These declines followed progress toward resolving Middle East conflicts, which had previously driven sharp price increases.
Analysts have adjusted their 2026 oil price forecasts downward for the first time since the onset of the Iran conflict, following five consecutive months of increases. This adjustment is attributed to the reopening of the Strait of Hormuz, alleviating concerns over prolonged supply disruptions, as indicated by a Reuters poll.
“This is not going to end in a place where the Iranians are collecting tolls on ships going through the Strait of Hormuz.”
JD Vance, U.S. Vice President
U.S. Vice President JD Vance assured that Iran would not be allowed to impose tolls on ships passing through the Strait of Hormuz, stating on The Michael Knowles Show, "This is not going to end in a place where the Iranians are collecting tolls on ships going through the Strait of Hormuz." Tanker traffic through the strait has started to recover, with oil flows reportedly returning to pre-war levels.
U.S. crude oil inventories fell by 6.1 million barrels in the week ending June 26, according to market sources citing the American Petroleum Institute. Gasoline stocks also declined, with official data from the Energy Information Administration expected to be released on Wednesday.
Background
The oil market has been volatile due to geopolitical tensions, particularly involving Iran and the strategic Strait of Hormuz. The strait is a critical chokepoint for global oil shipments, and any disruptions can significantly impact global oil supply and prices.
As the situation in the Middle East evolves, market participants will closely monitor developments in diplomatic talks and inventory levels. The outcome of these discussions and the forthcoming inventory data could significantly influence future oil price movements.
