Oil Prices Tumble as Hormuz Reopening Hopes Grow

Oil prices took another hit on Thursday as hopes for a reopening of the Strait of Hormuz grew amid diplomatic efforts between Iran and Oman. Brent crude futures fell $0.60, or 0.7%, to $87.24 per barrel, marking its fourth consecutive session of losses. West Texas Intermediate crude futures dropped $0.56, or 0.7%, to $81.67 per barrel.

The Strait's reopening could ease concerns over supply disruptions caused by the Middle East war. Iran and Oman are working to finalize an agreement governing the waterway, according to a Reuters report. The comments came after Iran's Revolutionary Guards said the two countries had reached an understanding on how to share control of the waterway and its revenues.

The Strait links major Gulf oil producers with global markets. Before the US-Israeli war on Iran began on February 28, the Strait carried oil and natural gas shipments equivalent to about one-fifth of global consumption of these fuels. Oil flows have since fallen to about one-quarter of their pre-war level after Iran moved to close the waterway in response.