Oil Price Today (July 3): Crude oil heads for 4th weekly loss on Hormuz traffic, US-Iran talks. Where is liquid gold headed?

Crude oil prices stayed under pressure on Friday as tanker traffic through the Strait of Hormuz continued to recover and diplomatic engagement between the US and Iran showed signs of progress. Brent crude is also headed for a fourth straight weekly decline, its longest losing streak since August 2024

Crude oil price on July 3

Brent crude hovered near the $71-a-barrel mark after briefly dipping below that level in the previous session, while US benchmark West Texas Intermediate (WTI) traded around $68 a barrel.

The commodity has retreated sharply from the $125-a-barrel highs touched during the peak of the Gulf conflict, as higher output from regional producers and improved supply expectations followed the preliminary memorandum of understanding (MoU) signed by the US and Iran in mid-June.

Saudi Arabia, the region’s largest oil producer, has restored exports to roughly 90 percent of pre-conflict levels for most of this week. A significant share of the kingdom’s crude shipments passes through the Strait of Hormuz.

Speaking to CNBC, US President Donald Trump said negotiations with Iran were still underway and claimed that Tehran “has agreed to just about everything we need.” However, the Wall Street Journal reported that Iran remains unwilling to abandon its demand for control over the Strait of Hormuz and intends to continue charging transit tolls after the 60-day deadline expires.

Supply has increased not only from Saudi Arabia but also from the United Arab Emirates, which is no longer an OPEC member, and from Iran after it secured sanctions relief under the terms of the preliminary MoU.
Read more: Crude oil correction could be India’s next big market trigger: Rohit Seksaria

Worst over?

Macquarie Group has sharply lowered its oil price forecasts for 2026 and 2027, citing expectations of a quicker-than-anticipated normalization of crude flows from the Middle East. Following the interim peace agreement between the United States and Iran, which has allowed oil shipments to resume from the Persian Gulf, the bank now expects brent crude, the global benchmark, to average $77 a barrel in 2026, down from its earlier forecast of $89. It also cut its 2027 Brent outlook to $64 a barrel from $74 previously.
Despite several challenges that could slow the recovery in regional oil production, producers in the Middle East are likely to restore output faster than markets currently anticipate, strategists Peter Taylor, Vikas Dwivedi and others said in a research note.
Tanker movement through the strait has started improving, with U.S. Vice President JD Vance said oil flows had returned to pre-war levels, although he did not provide any figures.

Others argue that despite the improvement, a complete reopening of the Strait of Hormuz is expected to take time, say experts. It will require coordination of vessel movements, restarting oil wells, repairing damaged infrastructure and agreements on de-mining operations. Some shipowners also remain cautious about operating in the strait and the wider Persian Gulf.

Analysts said global oil inventories were depleted during the prolonged disruption to shipping through the Strait of Hormuz and will take time to rebuild. They added that stockpiles could continue to decline before additional supplies from the Gulf start reaching international markets.

Last month, Saudi Aramco Chief Executive Officer Amin Nasser warned that disruptions in the Strait of Hormuz could delay the return of stability to global oil markets until 2027. He said prolonged interruptions could affect nearly 100 million barrels of oil supply every week. Saudi Aramco is the world’s largest oil producer.

Also read: India’s next stock market headache isn’t oil but a bigger storm brewing in the skies

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