Global Economy — 2026-06-29

Brent Oil Falls Below Prewar Levels as Strait of Hormuz Traffic Improves

BLUFDespite oil prices dropping below prewar levels, full commercial normalization of the Strait of Hormuz remains very unlikely by July 31 as mine clearance lags and ceasefire violations sustain insurer and operator risk aversion.

Brent settled Friday at $71.99 per barrel, below its pre-war close of $72.87 on February 27, while WTI fell 3.74% to $69.23; both benchmarks posted weekly losses exceeding 8% 12. US Energy Secretary Chris Wright told a forum that Hormuz flows were near pre-war levels, with at least 20 million barrels exiting the strait in the prior 24 hours, though he noted mine clearance is still required before full normalization 3. Saudi Aramco resumed loading at Ras Tanura on Friday after a near-four-month halt, and the IEA reported UAE exports had recovered to approximately 85% of pre-war levels in early June 1. A cargo vessel was struck near Oman on Thursday; a US official told media that Iran was responsible, Trump posted that Iran had violated the ceasefire, and US Central Command announced retaliatory strikes 12.

Analysis
Mine clearance is the binding constraint on Hormuz normalization: Wright conditioned it on cleared lanes, insurance premiums cannot reset until certification, and Thursday's cargo vessel strike followed by US retaliatory strikes shows the ceasefire remains contested, extending the confidence gap for commercial operators regardless of outbound flow metrics. Full normalization by July 31 is very unlikely. Moderate analytic confidence rests on convergent multi-outlet reporting on the mine clearance requirement and the documented lag between outbound flow recovery and inbound tanker confidence. The war premium is now fully unwound, with Saturday's strikes failing to reverse the decline; markets may be discounting Thursday's exchange as tactical noise rather than deliberate interdiction policy, underweighting reversion risk. Tanker operators and energy charterers face a routing decision now. A no-resolution path sustains elevated insurance premiums and freight costs through at least August.

5 sources

Brent oil below prewar levels as Strait of Hormuz traffic improves - The National
U.S. crude oil falls below $70, resuming losses after attack on cargo ship near Oman - CNBC
Oil prices back to pre-war levels on rising Middle East supply - Al Jazeera
Brent Crude Oil Price Today (June 26): Brent Drops Below $75, WTI Slips Near $71.5 as Strait of Hormuz Traffic Improves & Supply Concerns Ease - Sunday Guardian Live
Brent Erases Iran War Premium as Hormuz Flows Show Signs of Recovery - OilPrice.com