Oil prices dropped to a three-week low on Tuesday after senior US officials signaled progress on a draft deal with Iran that could reopen the Strait of Hormuz. Brent crude fell back toward $80 a barrel and US crude slid to $76, even as President Trump pressed oil majors over refining profits.
Brent crude sank on Tuesday as US Secretary of State Marco Rubio and Treasury Secretary Scott Bessent both pointed to progress in talks aimed at reopening the Strait of Hormuz to oil shipments. The waterway has been a flashpoint since the US-Iran conflict began in late February, when it handled about one-fifth of global daily oil and liquefied natural gas supplies.
Brent and WTI slide on Hormuz hopes
The US West Texas Intermediate contract dropped more than 5% to $76 a barrel, while Brent crude fell almost 5% to under $80 a barrel. Both contracts fell to their lowest levels since July 13.
Rubio and Bessent point to a deal within days
According to the BBC: "There's been progress made in those talks, but not finality yet.", Rubio told reporters at the State Department that talks with Iran and Oman on letting more ships through the Strait were progressing. Bessent went further, telling CNBC a deal to reopen the Strait could be reached as soon as Tuesday or Wednesday.
Qatar, one of the mediators between Washington and Tehran, said it was continuing efforts toward a diplomatic resolution but admitted no direct talks were currently planned. Iran has said it is not negotiating with the US and is instead talking to Oman.
Months of disruption show up at the pump
Months of disruption have pushed pump prices higher worldwide. In the UK, average petrol prices have climbed to £1.60 a litre, back to levels last seen at the start of the conflict. US gasoline is averaging above $4 a gallon and diesel almost $5.40.
Saudi Aramco, meanwhile, reported a 33% jump in second-quarter profit to $33.4 billion as higher oil prices offset lower output. President Trump has turned his attention to US refiners, ordering retailers to bring prices down and telling ExxonMobil and Chevron to hand back some of their earnings to the public. On Monday, he warned Iran was running out of time to agree to a deal allowing commercial shipping to resume through the Strait.
Sources: Oilprice.com, BBC News
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