West Texas Intermediate traded close to $88, while Brent dropped toward $93 per barrel, down 18% this month. After Axios reported that shipping via the Strait would be “unrestricted”, a person familiar with the situation claims that President Donald Trump has not yet agreed to the parameters of the agreement.
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Although the warring sides have frequently reported progress in the past, only for the impasse to continue, Brent is expected to suffer its largest monthly loss since 2020 due to optimism based on the anticipation that some kind of agreement will be achieved.
With millions of barrels of daily oil supply cut off, the effective shutdown of Hormuz, which is under siege by Washington and Tehran, has caused an unprecedented global energy shock.
Several obstacles might prevent oil flows from resuming, even if a truce extension is agreed upon. Among them are the necessity to remove mines from the Hormuz waterway, the possibility that it will take months for shut-in fields to reopen, and the need to rebuild energy infrastructure damaged by drone and missile strikes. Furthermore, it would take weeks for ships to arrive in importing countries.
(Edited by : Juviraj Anchil)
