Global oil prices fell sharply on Friday as crude exports from the Persian Gulf continued to recover and shipping traffic through the Strait of Hormuz increased, easing concerns over supply disruptions following the recent US-Iran conflict.
Brent crude dropped 4.3% to settle below $72 per barrel, while West Texas Intermediate (WTI) fell 3.7% to close near $69 per barrel. Both benchmarks have now erased nearly all of the gains recorded during the conflict and posted losses of more than 10% for the week.
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Market sentiment turned bearish as more Middle Eastern crude returned to global markets. Saudi Arabia resumed loading tankers at its Ras Tanura export terminal, while oil exports from the region have recovered to around 75% of pre-conflict levels. The United Arab Emirates, Kuwait and Qatar have also increased production.
Shipping activity through the Strait of Hormuz has steadily resumed despite isolated security incidents, reducing fears of prolonged supply disruptions. The recovery in maritime traffic has reinforced expectations of improving global oil availability.
Analysts noted that signs of oversupply are becoming increasingly evident, with Brent futures moving deeper into contango—a market structure typically associated with abundant supply.
Despite renewed geopolitical concerns following reports of attacks on commercial vessels and allegations of ceasefire violations, traders largely focused on improving supply fundamentals and the rebound in Gulf exports.
However, logistical challenges remain. Some regional producers continue to face shortages of oil tankers, while Iraq has reportedly sought a higher OPEC production quota to compensate for export losses incurred during the conflict.
