Brent crude dips below $72.48 pre-war mark as tanker traffic doubles through Strait of Hormuz

Oil falls below pre-conflict marker

Brent crude dipped as low as $72.24 a barrel on Thursday, slipping beneath the $72.48 closing price recorded on 27 February, the eve of US and Israeli strikes on Iran. The decline extends a four-session losing streak and erases the war premium that had pushed prices to a peak of $126 in March. West Texas Intermediate also fell, trading at $69.36 a barrel.

Tanker traffic recovers sharply

Shipping data shows a rapid rebound in Strait of Hormuz transits. According to MarineTraffic figures, vessel movements through the waterway doubled over the past 24 hours to their highest level since late February. Windward data indicated 31 tankers left the Gulf on Wednesday, a near 50% rise from the previous day. US Energy Secretary Chris Wright said at least 20 million barrels had departed on 72 ships in the preceding day.

The chokehold on the Strait of Hormuz has been released, tanker traffic is flowing more freely, and supply concerns are fading.

Supply glut meets weakening demand

In addition to the reopening of the strait, a 60-day US sanctions waiver on already-loaded Iranian oil, increased pipeline exports from Saudi Arabia and the UAE, and strategic petroleum reserve releases have added supply. On the demand side, slowing global growth and continued restraint by China, the world's top importer, have left the market with a short-term surplus. Traders are now willing to pay more for later deliveries than for immediate barrels, a contango structure that signals ample near-term availability.

The turnaround in prices and narrative from just two weeks ago is remarkable. The idea of higher supply meeting weaker demand has truly driven this drop.

Petrol prices lag crude declines

Retail fuel costs have yet to fully reflect the wholesale drop. In France, diesel averaged €1.89 per litre and SP-95 E10 €1.90 on Thursday, versus pre-war levels of €1.69 and €1.71 respectively. Motoring groups typically expect a ten-day lag before pump prices catch up with crude markets.

Traders are pricing in a return to normality. They are not taking into account the risks further down the road, which still remain very real.

Analysts see fragile calm

Some analysts warn that the swift sell-off may be overdone. Amrita Sen of Energy Aspects noted that global inventories remain extremely low after months of disruption and that she expects prices to climb back to $80–$90 a barrel within a month. Macquarie has forecast Brent averaging $67 in the third quarter, down sharply from $94 in the second. Meanwhile, the Iranian Revolutionary Guards' navy insisted on mandatory coordination for vessels transiting Hormuz, and lingering disagreements over potential tolls could complicate the diplomacy. The US and Iran signed a 60-day interim agreement last week, with a final deal still to be negotiated.