Brent crude, the international benchmark for oil prices, briefly dipped below $72.48 per barrel before recovering slightly to trade around $73.23. The decline marks a significant turnaround from the sharp price spikes witnessed during the height of the conflict, when fears of supply disruptions rattled energy markets worldwide.
The easing in prices comes amid growing optimism following diplomatic efforts to de-escalate tensions in the region. Representatives from the United States and Iran met in Switzerland last weekend for negotiations aimed at ending the conflict. The talks resulted in Washington partially easing sanctions on Iranian oil exports, a move that has helped calm concerns over global supply shortages.
Shipping Activity Returns
One of the clearest signs of improving conditions has been the increase in vessel movements through the Strait of Hormuz, one of the world's most important maritime trade corridors. The narrow waterway serves as a critical route for oil, liquefied natural gas and other commodities destined for international markets.
According to maritime intelligence firm Kpler, 284 vessels have transited the strait since 18 June, the day after the Memorandum of Understanding (MOU) between the US and Iran was signed. While the figure remains below normal levels, it reflects a notable improvement compared with the disruption seen during the conflict.
Before the war, an average of about 138 vessels crossed the strait each day. Recent traffic has included tankers carrying crude oil, LNG shipments, fertiliser cargoes and a range of commercial goods.
The recovery in shipping activity follows efforts by both sides to ensure safer navigation in the region. Mediators Qatar and Pakistan revealed on Monday that Washington and Tehran had established a direct communication channel to avoid incidents at sea.
The two countries formed a "communication line" to prevent misunderstandings "with the aim of safe passage for commercial vessels through the Strait of Hormuz", according to a joint statement issued by the mediators.
Industry observers say confidence among ship operators is gradually returning.
"There has been a 'tremendous shift' with far more ships using the strait in recent days," said Dimitris Maniatis, chief executive of maritime risk advisory firm Marisks, which has been working with vessels stranded in the region during the conflict.
Maniatis explained that a limited number of ships are currently being allowed to use a northern passage under the supervision of Iranian authorities. At the same time, the US Navy has provided guidance for vessels travelling through a southern route that has been cleared of mines and other wartime hazards.
Despite the progress, maritime activity has yet to fully recover. Hundreds of vessels are still believed to be waiting in Gulf waters, highlighting the lingering caution among shipping companies and insurers.
Relief for Drivers Expected
The fall in oil prices is expected to bring some relief to consumers who faced rising fuel costs during the conflict.
In the United Kingdom, petrol and diesel prices surged as fears over Middle Eastern supply disruptions intensified. Analysts now expect those increases to begin reversing in the coming days.
"On the back of the lowest oil price since before the Iran war started, drivers should see the average price of petrol fall below 150p [a litre] in the next week or so," said Simon Williams, head of policy at the RAC.
He added that diesel prices "ought to go back under 160p."
According to RAC data, petrol prices peaked at 159.53 pence per litre on 28 May, while diesel reached a high of 191.54 pence per litre on 15 April.
In the United States, the average price of regular gasoline has also edged lower, falling to approximately $3.93 per gallon after reaching $4 per gallon in April. However, prices remain above levels recorded before the conflict began.
Trump Targets Energy Companies
The continued gap between falling crude prices and slower reductions at fuel stations has drawn criticism from political leaders.
US President Donald Trump on Wednesday ordered an investigation into major energy firms, including Shell and ExxonMobil, accusing them of failing to pass lower oil costs on to consumers.
"Oil prices have come down so much and we are not seeing anything at the pump by comparison the way they should be," Trump told reporters in the Oval Office.
The oil industry has pushed back against the allegations. The American Petroleum Institute, which represents energy producers in the United States, argued that fuel prices "don't move in lockstep with crude oil", citing factors such as refining costs, transportation expenses and market conditions.
Similar concerns have emerged in Britain, where energy retailers have faced accusations of profiteering since the conflict erupted. However, the UK's competition watchdog said last month that there was no widespread evidence of unfair pricing, noting that average profit margins remained "broadly unchanged" between February and March.
Uncertainty Still Lingers
Energy markets have experienced dramatic swings since Iran responded to military strikes by effectively closing the Strait of Hormuz, raising fears of a major disruption to global oil and gas supplies.
The recent decline in crude prices accelerated after the United States and Iran signed a Memorandum of Understanding on 17 June. The agreement established a 60-day negotiation period focused on Tehran's nuclear programme and broader measures aimed at ending the war.
While markets have welcomed the diplomatic breakthrough, analysts warn that the situation remains fragile.
Pratibha Thaker, Regional Director for the Middle East and Africa at the Economist Intelligence Unit, cautioned that the current stability could quickly unravel if tensions flare up again.
"Markets are still watching the region closely, and any renewed tensions could quickly send oil higher again," she said.
For now, the reopening of shipping routes and renewed diplomatic engagement have eased immediate fears of a prolonged energy crisis. Yet with hundreds of vessels still awaiting clearance and geopolitical risks far from resolved, the global oil market remains highly sensitive to developments in the Gulf.