Oil prices erased wartime gains on Thursday as easing supply concerns and recovering tanker traffic through the Strait of Hormuz weighed on crude markets.
International benchmark Brent crude fell 1.7% to below $72.50 per barrel as of 0610GMT, while US benchmark West Texas Intermediate declined 1.4% to around $69.40 per barrel.
Prices moved back toward levels seen before the Middle East war broke out in late February, as investors priced in improving global crude supplies following the reopening of the key waterway.
More than 20 oil tankers carrying about 35 million barrels of crude have passed through the Strait of Hormuz since the US and Iran reached an agreement to reopen the route, according to trade-tracking firm Kpler.
The vessels, mostly non-Iranian tankers, had been stranded in the Persian Gulf for more than three months after Tehran effectively restricted traffic through the waterway early in the conflict.
Most of the cargoes are expected to reach Asian destinations by early August, adding to expectations that physical crude supply will improve in the coming weeks.
The Strait of Hormuz is one of the world’s most critical energy corridors, with a large share of seaborne crude and liquefied natural gas exports from Gulf producers passing through the narrow route.
Despite the decline in prices, security risks remain.
Iran’s Islamic Revolutionary Guard Corps Navy warned Thursday that safe passage through the Strait of Hormuz would only be permitted through routes designated by Tehran, saying vessels that violate transit instructions would “face action.”
The warning highlighted that while tanker traffic has started to recover, the normalization of energy flows through the Gulf remains vulnerable to military and political risks.
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