Oil Prices Plummet Amid Renewed Optimism Over Strait of Hormuz

Oil prices have tumbled for the third straight day amid renewed optimism that the Strait of Hormuz might soon be safe enough for vessels to transit.

The U.S. State Department is preparing to return American diplomats to their posts at embassies across the Middle East, and Secretary of State Marco Rubio told U.S. allies that the Trump administration does not expect to resume military strikes on Iran, according to Axios.

Paul Donovan, global chief economist for UBS Wealth Management, sounded a cautiously optimistic note: 'While this may not signal an immediate reopening of the strait, it does suggest Iran is considering reopening the strait.'

Oil prices have been volatile in recent months, with both WTI and Brent crude futures down 9% since Sunday. The U.S. crude oil price has fallen more than 1.5%, to around $81 per barrel, while international benchmark Brent was trading at just under $86 per barrel.

The Strait of Hormuz is a critical waterway for global oil shipments, and any disruption to its operation can have significant impacts on the global economy.