US-Iran preliminary agreement reopens Strait of Hormuz, oil prices fall; Israel continues Lebanon operations

Strait of Hormuz reopens

Three Saudi-flagged supertankers loaded with a combined six million barrels of crude crossed the Strait of Hormuz today, only hours after the US and Iran signed a preliminary agreement to end the war. According to ship-tracking data analyzed by Reuters, these were the most significant departures via the strait in weeks. Other tankers that had been sailing with their transponders off for security reasons also switched them back on and disclosed their positions.

The French-flagged LNG carrier Mraikh, owned by a French subsidiary of Norway's Knutsen OAS Shipping, exited the Gulf carrying 76,535 tonnes of LNG loaded at Ras Laffan, Qatar, bound for Pakistan, according to Kpler. The vessel sailed almost simultaneously with the signing. Only 15 LNG tankers had left the Gulf since the war began. The Hong Kong-flagged tanker Tong Lin Wan, which had been stuck in Gulf waters since early March with a cargo of naphtha from Abu Dhabi's Ruwais refinery, also passed through the strait today heading for Singapore, LSEG data showed.

Oil markets and prices

Brent crude futures fell more than 2%, trading below $78 a barrel, while US West Texas Intermediate dropped below $75. The decline extends a rout that has erased the price surge triggered by the closure of the strait. Before the war, Brent was around $70; it spiked to $118 at the end of March, then fell to $83 after the announcement of the preliminary deal earlier this week.

Pre-war70

Late March 2026118

After preliminary deal announcement83

18 June 202678

Pre-war

70 $/bbl

Late March 2026

118 $/bbl

After preliminary deal announcement

83 $/bbl

18 June 2026

78 $/bbl

Data from the article text

Market sources told Naftemporiki that the oil price lost in five sessions the gains accumulated over three months. EU Energy Commissioner Dan Jørgensen cautioned in early April that even full peace tomorrow would not bring an immediate return to normal, as high risk premiums and tanker freight rates must also unwind.

“Even if there is full peace tomorrow, we will not return to normal in the near future.”

The preliminary deal

Signed by US President Donald Trump and Iranian President Masoud Pezeshkian, the 14-point memorandum of understanding provides for the immediate reopening of the Strait of Hormuz, the lifting of the US blockade on Iranian ports, and the removal of American sanctions on Tehran's oil. A 60-day negotiation window is set to reach a final agreement. The full restoration of traffic is expected to take up to a month because of mines and supply-chain disruptions.

Markets rally, geopolitical risks remain

US equity futures climbed, with S&P 500 contracts up as much as 0.9% and Nasdaq futures rising 1.5%, recovering some of the losses triggered by the Federal Reserve's hawkish stance the previous day. Analysts said the deal reduced the geopolitical premium that had weighed on global markets.

“Significant geopolitical risks still exist and will remain a key factor influencing the market.”

The US dollar stayed near a two-month high as the Fed's rate decision reinforced tightening expectations. Everbright Securities International strategist Kimi Tong noted that markets are now watching whether the strait truly reopens for free passage; until confirmed, dollar-supportive sentiment would persist.

“Markets are examining whether the Strait of Hormuz may reopen for free transit.”

Israel continues Lebanon operations, US-Israel friction

Despite the diplomatic breakthrough, Israeli airstrikes and artillery fire continued in southern Lebanon this morning. Israel says its forces remain in a security zone and is negotiating with Washington over maintaining a military presence there. Lebanese residents displaced by the fighting describe persistent uncertainty.

The absence of Israel from the talks has deepened tensions with the US. Israeli officials said the outcome depends on whether the US president pushes Israel to comply with the deal's terms. Analysts view the situation as one of the most serious strains in US-Israel relations in decades.

IEA warns of looming supply glut

The International Energy Agency, in a new report, said global oil demand would decline by 1.1 million barrels per day this year because of high prices and severe supply-chain disruption. Supply is set to fall by 3.9 million b/d in 2026, with roughly one-fifth of global supply still trapped in the Persian Gulf. However, the agency projects that in 2027 demand will rise by 2 million b/d while supply could grow by as much as 8 million b/d, creating a significant surplus.

“Our first estimate for the 2027 market balance shows that a significant supply surplus is forming next year.”

The IEA warned that full restoration of flows through the strait will take months as sea lanes are cleared of mines and supply chains recover.

Domestic criticism in the US

Inside the United States, Trump's concessions to Iran have drawn fire even from Republican allies. Former US ambassador to the UN Nikki Haley said the administration appears ready to grant Iran too many economic benefits without getting enough in return.

“If this is true, Iran is winning.”