Full Breakdown
Oil Prices Slide as the Strait of Hormuz Reopens Amid US-Iran Talks
6/25/2026, 9:12:15 PM
Reopening of the Strait and Market Reaction
On 17 June 2026 the United States and Iran signed a memorandum of understanding (MOU) to reopen the Strait of Hormuz for a 60-day period while negotiating a permanent settlement. Within days more than 20 tankers (?35 million barrels) resumed transit, and Brent crude fell from $75 to a low of $72 per barrel, erasing the wartime premium.
Background to the Blockade
The conflict began in late February 2026 when Iran shut the strait in retaliation for U.S.–Israeli missile strikes, prompting a U.S. naval blockade. Oil prices spiked to $120 per barrel and daily traffic fell from over 130 vessels to near zero, creating a large backlog.
Official Statements & Responses
Vice President J.D. Vance met Iranian officials in Switzerland for high-level talks, confirming the MOU’s 60-day window. The Treasury issued a temporary license for Iranian oil sales through 21 August. Qatar and Pakistan announced a joint “communication line” for safe commercial passage. Iran’s IRGC warned that only Tehran-designated routes are permitted, threatening vessels that “face action.” The U.S. Navy advised using the southern, mine-cleared lane, and Energy Secretary Chris Wright said daily flows now approach pre-war levels.
Criticism & Opposition
Analysts warn that reopening does not guarantee lower pump prices; Wood Mackenzie’s Isabelle Gilks says consumers should not expect an immediate drop. Oxford Economics’ Grace Zwemmer notes shipping remains “more costly and riskier” because of possible mines. President Donald Trump accused refiners of “price gouging” despite falling crude.
Conflicting Reports & Gaps
Brent’s low is reported as $72.48 (NYT), $73-plus (CNBC), $72.24 (Guardian), $77.39 (Marinelink) and $73.34 (Kuwait). Vessel counts range from 78 (NYT) to 109 over a weekend (Fox Business) and about 80 (BBC). Forecasts differ, with Citi seeing $60-65 and Swissquote’s Ipek Ozkardeskaya expecting $60-80.
Verbatim Quotes
- “remains more costly and riskier than before the war due to the potential presence of sea mines and elevated risk premiums.” — Grace Zwemmer, Oxford Economics
- “face action.” — Islamic Revolutionary Guard Corps Navy
- “Oil prices have come down so much and we are not seeing anything at the pump by comparison the way they should be,” — President Donald Trump
- “While recent developments around the reopening of the strait offer some optimism, consumers should not expect an immediate or sharp drop in gasoline prices. Although crude and gasoline prices have fallen over recent weeks, the crude oil flowing through refineries today was purchased weeks ago, meaning any price relief at the pump will take time to materialise.” — Isabelle Gilks, Wood Mackenzie
What’s Next
The 60-day MOU ends in mid-August, after which the United States and Iran must decide on a permanent arrangement. Mine-clearing continues, and the International Maritime Organization is coordinating alternate lanes. Analysts expect Brent to settle between $60 and $80, but any renewed tension could reignite price spikes and postpone the anticipated easing of gasoline costs.
