LONDON — Global oil prices fell to their lowest levels since the start of the US-Iran conflict, as markets reacted to progress toward de-escalation and potential reopening of key shipping routes.
Brent crude, the global benchmark, dropped more than 4% on Wednesday to around $73.50 per barrel, while West Texas Intermediate futures fell about 4.4% to just below $70 per barrel, according to market data. This marked the first time prices had reached such levels since the conflict began nearly four months ago.
The decline followed reports of a US-Iran agreement and ceasefire developments that could ease disruptions in the Strait of Hormuz, through which a significant portion of global oil shipments pass. US officials, including statements associated with Vice President JD Vance, indicated progress in talks aimed at stabilizing the situation.
Oil prices had surged sharply after the conflict escalated in early March 2026, with Brent crude reaching highs above $120 per barrel at times amid supply concerns and shipping disruptions. Prior to the conflict, prices had traded closer to the $60-$70 range.
Analysts attributed the recent drop to optimism over a potential reopening of the Strait of Hormuz and eased fears of prolonged supply shortages. The US Treasury Department authorized Iranian crude sales through August, contributing to the downward pressure on prices, market participants said.
"The market is pricing in hopes of a more stable supply environment following the latest diplomatic signals," one trader noted, speaking on condition of anonymity due to the sensitivity of ongoing discussions.
The conflict had strained global energy markets, leading to higher costs for consumers and businesses worldwide. Some reports estimated significant economic impacts from elevated energy prices during the height of the tensions.
Iranian oil exports had fallen to low levels earlier in the conflict due to disruptions, according to shipping data. Details on the exact terms of any current agreements and their immediate effect on production and exports remain unclear.
Oil prices have fluctuated in recent weeks amid shifting expectations. As of Wednesday evening, benchmarks remained volatile, with traders monitoring developments between the US and Iran for further signals on implementation of any deals.
White House officials and energy market participants offered no immediate additional comment on the long-term outlook for prices or the conflict's resolution.
