Oil falls to lowest since start of Iran war after ceasefire deal signed

By Robert Harvey and Anushree Mukherjee

LONDON, June 18 (Reuters) - Oil prices fell astir 3% connected Thursday to their lowest since the archetypal trading time of the Iran war, arsenic a U.S.-Iran ‌interim woody to extremity the conflict, reopen the Strait of Hormuz and easiness sanctions connected Tehran ‌boosted the planetary proviso outlook.

Brent crude futures were down $1.53, oregon 1.9%, astatine $78.02 a tube astatine 1326 GMT, portion U.S. West Texas Intermediate fell $2.22, ​or 2.9%, to $74.57 a barrel.

Brent sank to its lowest since March 2, which was the archetypal time of trading aft the archetypal U.S.-Israeli strikes connected Iran, portion WTI was astatine its lowest since March 4.

"The selloff extended arsenic vigor markets continued to aggressively terms successful a faster-than-expected instrumentality of Iranian barrels pursuing the caller U.S.-Iran memorandum of understanding," ‌IG marketplace expert Tony Sycamore said ⁠in a note.

The 14-point memorandum begins a 60-day dialog play during which Iran volition let toll-free transition done the Strait of Hormuz, a cardinal lipid and state shipping lane. ⁠The woody calls for postulation done the strait to beryllium restored to its afloat capableness wrong 30 days.

The preliminary accord defers galore of the much hard issues, specified arsenic Iran's atomic programme, and besides requires the U.S. and its partners ​to ​come up with a $300 cardinal program to concern Iran's recovery.

Analysts ​expect a gradual betterment successful flows done ‌the Strait of Hormuz, portion manufacture experts person cautioned that prices whitethorn not plummet arsenic request recovers and inventories are refilled.

Investment slope Goldman Sachs expects Gulf exports to normalise to pre-war levels by end-July, with crude accumulation recovering by October.

The slope estimates that a normalisation successful exports to pre-war levels mightiness beryllium achieved with a 13 cardinal barrel-per-day summation successful Hormuz flows from existent levels to astir 70% of pre-war levels.

BNP Paribas does not ‌currently expect a instrumentality to pre-war prices and views $75 per tube ​as a "durable level for the foreseeable future," it said successful a ​note, fixed ongoing proviso losses and higher demand. ​Brent traded astir $60 to $70 per tube successful the archetypal 2 months of the twelvemonth ‌before the Iran war.

China, the world's second-largest lipid ​consumer, is forecast to devour ​753 cardinal metric tons successful 2026, down 4.9% from 2025 amid a pivot to caller vigor and precocious lipid prices, according to a study published by PetroChina's probe unit.

Ukrainian drones deed the Russian ​capital's lipid refinery for the 2nd ‌time this week successful what Kyiv formed arsenic a objection of its increasing capabilities.

(Reporting by Robert ​Harvey successful London, Anushree Mukherjee successful Bengaluru, Colleen Howe successful Beijing and Siyi Liu successful Singapore. ​Editing by Sonali Paul, Jan Harvey and Mark Potter)