LAGOS – Global oil prices dropped sharply to pre-war levels on Thursday, completely wiping out the geopolitical risk premium built up since the conflict erupted on 28th February.
Brent crude futures tumbled 1.44% to $72.68 a barrel, while U.S. West Texas Intermediate fell 1.08% to $69.58. Both benchmarks reached their lowest levels since the day before the war began.
Prices previously peaked near $126 a barrel after the closure of the Strait of Hormuz chokepoint trapped vital crude supplies. Brent has now shed nearly 25% of its value over the last month.
The steep market correction follows a preliminary U.S.-Iran peace agreement signed in mid-June. The deal effectively terminated military blockades and immediately reopened the strategic waterway to global commercial shipping.
To preserve the fragile truce, the U.S. Treasury also issued a 60-day General License. This waiver officially authorizes the production, delivery, and sale of Iranian oil through late August.
As physical crude flows rapidly normalize, energy analysts report that automated tracking systems show a massive backlog of oil tankers finally exiting the Gulf to supply global markets.
Market focus has pivoted from supply panic to macroeconomic headwinds. Despite heavily depleted global inventories from the 110-day war, traders are aggressively betting on a projected 2026 global supply surplus.
