The Week in Oil: Crude Futures Return to Prewar Levels

By Giulia Petroni

Here's a look at what happened in oil markets in the week of June 22-26 and what the focus will be in the days to come.

OVERVIEW: Oil prices dropped to prewar levels as traffic through the Strait of Hormuz picked up pace, with key producers in the region getting ready to restart production and restore exports. Brent crude, the international oil benchmark, was around $72 a barrel in afternoon trading on Friday, while West Texas Intermediate futures were trading around $68 a barrel. The benchmarks are on track for weekly losses of nearly 9% and 6%, respectively.

GEOPOLITICAL RISKS: The reopening of the key waterway and a U.S. waiver on Iranian oil sales following an interim deal between Washington and Tehran marked a turning point for Gulf crude markets. Transit volumes have picked up as vessel crossings increase and a greater share of ships resume transmitting tracking signals. Investors are also reassessing how much geopolitical risk should be priced into longer-dated oil contracts.

Even so, tensions haven't fully eased. An Iranian attack on a Singapore-flagged cargo vessel in the strait this week revived concerns over shipping security in the region, prompting the International Maritime Organization to pause evacuation operations for hundreds of vessels still stranded in the Persian Gulf.

Meanwhile, some analysts say the recent rebound in prices may be overdone. While flows are improving, it will take time for Gulf exports to fully normalize, and uncertainty remains over how security in the Strait of Hormuz will be maintained going forward. "Oil is now barely more expensive than before the start of the Iran war," analysts at Commerzbank said. "We fear, however, that market participants are too optimistic."

SUPPLY AND DEMAND: Ship traffic through the strait is increasing gradually, with oil shipments through the waterway reaching their fastest pace since the war began in late February.

Confirmed transits of Middle Eastern crude through the strait have risen to about 4.9 million barrels a day so far in June, Kpler analysts said on Wednesday. That remains well below the 2025 average of roughly 13 million barrels a day, but marks a clear recovery from the depressed levels seen during the war.

Despite the recovery in flows, inventories continue to tighten. U.S. crude stocks fell for a ninth consecutive week, dropping 6.1 million barrels, according to U.S. Department of Energy data, leaving inventories about 6.5% below the seasonal average.

WHAT'S AHEAD: Next week's energy calendar includes OPEC's monthly meeting and, potentially, Saudi Arabia's official selling prices, which will offer a read on the kingdom's outlook for demand in Asia and other key export markets. In the U.S., attention turns to consumer confidence, the ADP employment report and manufacturing data, alongside remarks from Federal Reserve Chairman Kevin Warsh for clues on the policy outlook.

Write to Giulia Petroni at giulia.petroni@wsj.com

(END) Dow Jones Newswires

June 26, 2026 13:12 ET (17:12 GMT)