Hormuz reopening hopes send oil prices tumbling as Iran negotiations gain traction

Hormuz reopening hopes send oil rates tumbling as Iran negotiations gain traction.

Key points

• Brent crude futures were down 60 cents, or 0.7%, to $87.24 a barrel ‌by 0004 GMT, down for a fourth day.
• US West Texas Intermediate drops 56 cents, or 0.7%, to $81.67 per barrel, marking fifth straight session of losses.
• Canada hits back as Trump's 50% tariffs take effect, sets retaliatory duties for Sept 8.
• ANZ's Hynes additionally pointed to the impact the Middle East war and the Russia-Ukraine war are having on the diesel market.
• Bitcoin rises above $80, 000 as soft dollar, debasement fears boost momentum.

US West Texas Intermediate drops 56 cents, or 0.7%, to $81.67 per barrel, marking fifth straight session of losses. Published August 27, 2026. Rates fall on hopes renewed efforts may reopen Hormuz. Iran, Oman finalising accord to manage strategic waterway. Flows through strait slip to regarding one-quarter of pre-war levels.

Oil rates fell on Thursday, extending a streak of multiple days of losses, on expectations that negotiations between Iran and Qatar may open the key Strait of Hormuz and reduce supply disruptions from the Middle East war.

Brent crude futures were down 60 cents, or 0.7%, to $87.24 a barrel ‌by 0004 GMT, down for a fourth day. West Texas Intermediate crude futures fell 56 cents, or 0.7%, to $81.67, down for a fifth day.

After Iran's Revolutionary Guards stated the two countries had agreed on how to share the waterway that connects major Gulf oil producers to markets and its ⁠revenues, iran and Oman are working on finalising details of an agreement to control the Strait of Hormuz, a senior Iranian source remarked on Wednesday.

In practice, the strait carried oil and natural gas shipments equal to regarding one-fifth of global consumption of the fuels before the US-Israeli war on Iran kicked off on February 28. Since Iran worked to shut the waterway in response, oil flows have dropped to regarding one-quarter of their pre-war level, according to ship-tracking data.

Though he cautioned "concerns over shortages in the oil market persist.", "Crude oil edged lower as the prospect of the Strait of Hormuz reopening improved amid ongoing talks, " remarked Daniel Hynes, senior commodity strategist at ANZ, in a note on Thursday.

Qatar's prime minister will head to Iran on Thursday to relaunch diplomatic discussions to end the conflict. It is almost six months old.

In practice, the US has halted its ‌attacks ⁠on Iran for regarding a month and is seeking to impose greater economic pressure on Iran. It has raised investors' expectations for an easing of the Gulf supply disruptions.

Still, the countries are far apart on their demands to end the fighting, and Iran has struck shipping in the Gulf and strait to impose its control on the waterway.

Iranian authorities have additionally noted the ⁠strait would not open unless the US met under an interim ceasefire agreement that was struck in June and afterwards unravelled.

ANZ's Hynes additionally pointed to the impact the Middle East war and the Russia-Ukraine war are having on the diesel market. Middle ⁠East refineries have been damaged in that conflict, and Ukraine has hit a number of Russian refineries, cutting exports from what was a major global diesel supplier.

Meanwhile, the curtailment in worldwide diesel output is showing up in inventory data. The US ⁠Energy Information Administration documented on Wednesday that distillate stockpiles, including diesel and heating oil, dropped by 2.2 million barrels in the week to August 21 to 103.4 million barrels.

Hynes remarked this is the lowest distillate stockpile level ever recorded for this time of year. Create us preferred on Google.

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Canada hits back as Trump's 50% tariffs take effect, sets retaliatory duties for Sept 8. Pakistan launches virtual asset licensing regime, sets September 5 deadline. US hits Canadian goods with 50% tariffs after trade discussions fail. Saudi, Turkish, Pakistani firms show solid interest in Gepco's privatisation.

Taken together, the developments around hormuz reopening hopes send oil prices tumbling as Iran negotiations gain traction point to a situation that is still moving, and the coming days should bring more clarity.