Oil prices fell by more than 51 TP3T as hopes grew for the reopening of the Strait of Hormuz.

Written by: Ayman Ragab

Brent crude prices fell by more than 5% during trading on Wednesday, after Iranian reports indicated the possibility of an agreement between the United States and Iran that could lead to the reopening of the Strait of Hormuz, one of the most vital waterways for oil and gas trade in the world.

Iranian state television reported that Tehran had received an initial, informal draft of a framework agreement with the United States, which includes a return of commercial shipping through the Strait of Hormuz to pre-war levels within a month.

He added that the proposed agreement also includes the withdrawal of US forces from the vicinity of Iran and the lifting of the naval blockade imposed on it, which has boosted market expectations of increased global energy supplies.

Oil prices decline

Iran announced on Tuesday that the United States had violated the ceasefire by targeting sites near the Strait of Hormuz, while Washington confirmed that the strikes were “defensive.”.

At the same time, Israel escalated its military operations against Lebanon, increasing pressure on peace efforts and raising fears of wider tensions in the region.

Despite the continued escalation, the passage of some liquefied natural gas tankers through the Strait of Hormuz in recent days has raised expectations that the waterway could be reopened soon, which has been reflected in oil prices as an increase in global supply is anticipated.