Brent crude futures were down $2.32, or 3.01%, at $74.76 a barrel by 1218 GMT. U.S. West Texas Intermediate slipped by $2.17, or 2.96%, to $71.04.
Brent touched a low of $74.61, its weakest level since February 27, the day before the start of U.S.-Israeli strikes on Iran. WTI fell as low as $70.91, the weakest since March 3.
“While there are early encouraging signs of increased tanker activity, the market is pricing in the broader scenario of Iranian oil re-entering the global market and the Strait of Hormuz normalising,” said Tim Waterer, chief market analyst at KCM Trade.
“If sanctions are eased, Iranian production and exports could ramp up relatively quickly given the substantial amount stored on tankers — we are likely talking weeks rather than months,” Waterer added.
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Adding to signs of market weakness, physical crude oil cargoes are selling at discounts across the globe, changing trade flows as markets come under pressure from fast-rising Middle Eastern supply with Iran set to boost sales following a temporary reprieve from U.S. sanctions.
Oman said it would keep the Strait of Hormuz open to shipping without imposing any tolls and had designated two temporary routes north and south of the existing shipping lane to facilitate the safe passage of vessels departing the region.Prices have also come under pressure this week from the 60-day sanctions waiver Washington granted Tehran after initial peace talks, allowing Iran to sell oil, and from an easing of hostilities in Lebanon.
Ships have already sailed through the Strait of Hormuz under a newly launched evacuation scheme by the United Nations’ shipping agency, a spokesperson said on Wednesday.
Uncertainty remains over the durability of the U.S.-Iran accord, however. U.S. President Donald Trump said on Tuesday that Iran had agreed to nuclear inspections into “infinity”, though Tehran said it had made no such concession.
“Markets are currently assigning too much confidence to a favorable outcome without fully discounting the risks associated with unresolved nuclear issues and inspection disputes,” said Mark Malek, CIO at Siebert Financial.
J.P. Morgan on Wednesday lowered its second-half 2026 Brent crude oil price forecast due to lower-than-expected OECD commercial inventory draws and softer demand for oil.
The bank sees Brent averaging $86 per barrel in the third quarter and $80 in the last quarter.
Elsewhere, Moscow’s oil refinery will be offline for at least six months after suffering extensive damage in Ukrainian drone attacks, two industry sources said on Wednesday.