Oil prices moved lower on Wednesday as investors monitored developments in negotiations between the United States and Iran after Washington indicated that diplomatic discussions were advancing.
Brent crude futures for July delivery, the global oil benchmark, dropped 2.5% to $109.25 a barrel by 04:44 ET (08:44 GMT), while U.S. West Texas Intermediate crude futures fell 1.9% to $102.35 a barrel. Both benchmarks had already declined by around 1% during Tuesday’s session.
Tankers leave Strait of Hormuz as supply optimism improves
Reuters reported, citing shipping data from LSEG and Kpler, that two Chinese-flagged supertankers carrying crude oil exited the Strait of Hormuz on Wednesday, fuelling hopes that energy flows through the strategically important route could gradually resume.
The South Korean-flagged Very Large Crude Carrier Universal Winner was also reported to be leaving the narrow passage off Iran’s southern coastline, which has effectively remained closed to tanker traffic since the outbreak of the U.S.-Israeli conflict with Iran in late February.
U.S. President Donald Trump told lawmakers on Tuesday evening that the Iran war could end “very quickly.” Earlier this week, Trump also stated that he had delayed a planned strike against Iran and suggested negotiations with Tehran were progressing positively.
Vice President JD Vance echoed that optimism in separate remarks, saying Iran appeared willing to negotiate an agreement.
According to Iranian state media, Tehran’s latest peace proposal called for a halt to military action across all fronts, the withdrawal of U.S. forces from the region and compensation for war-related damage. Previous Iranian proposals had largely been rejected by Washington, which continues to insist that ending Iran’s nuclear ambitions remains a central condition in any potential agreement.
Markets await official U.S. inventory data
Investors are now looking ahead to upcoming U.S. oil inventory figures for further indications on supply conditions amid ongoing disruptions to global energy flows.
Data released by the American Petroleum Institute showed a drawdown of 9.1 million barrels last week, significantly above expectations for a decline of 3.4 million barrels. The API figures are often viewed as an early indicator of the official U.S. inventory report scheduled for release later on Wednesday.
U.S. crude stockpiles are believed to have fallen sharply in recent weeks as the country increased exports to help offset supply disruptions abroad. Trump has also authorised the release of 172 million barrels from the Strategic Petroleum Reserve in an effort to reduce the impact of supply shocks caused by the Iran conflict.