Oil prices fall on Thursday

Oil prices fell on Thursday as investors reassessed the impact of renewed US strikes on Iran, with concerns over potential disruptions to oil flows through the Strait of Hormuz offset by hopes for renewed diplomacy.

Brent crude futures fell $1.03, or 1.32 per cent, to $76.99 a barrel by 0749 GMT, while US West Texas Intermediate (WTI) crude dropped 88 cents, or 1.2 per cent, to $72.64 a barrel, after both benchmarks reached their highest levels since June 22 in the previous session.

The decline followed overnight gains triggered by fresh US military strikes on Iran and retaliatory Iranian attacks on Kuwait and Bahrain, escalating tensions after US President Donald Trump declared an interim ceasefire with Iran “over.”

Analysts said markets remain focused on the security of the Strait of Hormuz, through which around one-fifth of global oil and Liquefied Natural Gas (LNG) supplies passed before the conflict. Some marine insurers have advised shipping companies to suspend voyages through the waterway following renewed attacks on vessels.

Goldman Sachs said Gulf oil flows could normalise by the end of July if negotiations resume, sanctions waivers on Iranian oil are restored, and shipping security improves. However, it warned that failed talks, escalating tanker attacks, or tighter US restrictions on Iranian oil could lead to further supply disruptions.

Separately, Russia banned diesel exports on Wednesday to stabilise its domestic fuel market after Ukrainian drone attacks on refineries caused fuel shortages and price spikes.

Attribution: Reuters