Yesterday (06/15), the most active Brent futures contract closed down 4.76%, priced at USD 83.17/bbl. WTI settled at USD 80.75/bbl (–4.87%), with both contracts posting their lowest close since March 4.
The move reflected the signing of a memorandum of understanding between the US and Iran to end the conflict and reopen the Strait of Hormuz, removing part of the risk premium accumulated in recent months. Investors reacted to expectations of normalization of physical flows through the strait over the coming months, although details regarding the timeline and reopening conditions remain incomplete.
As of around 08:00 a.m. this Tuesday (06/16), Brent was trading at USD 80.9/bbl (–2.7%), after hitting a low of USD 81.00/bbl. The market continues to price in a gradual supply recovery, but maintains caution given the absence of a final agreement and ongoing logistical execution risks in the Persian Gulf.
US-Iran Agreement: Reopening of the Strait of Hormuz in 30 Days, But Uncertainties Persist
The memorandum of understanding was signed by US representatives and the president of Iran’s parliament, with the official ceremony scheduled for Friday (19) in Geneva. The agreement foresees reopening of the Strait of Hormuz within 30 days under Iranian arrangements, permanent cease-fire on all fronts — including Lebanon — and initiation of final negotiations within a 60-day window, covering the Iranian nuclear program and release of up to USD 25 billion in frozen Iranian assets.
Why it Matters: The Strait of Hormuz has remained closed for over three months, removing more than 14 mbpd — roughly 14% of global demand — from the market and pushing world inventories to their lowest levels since 2003. The reopening eliminates the main geopolitical risk premium embedded in prices, but the speed of supply normalization depends on mine removal, reactivation of maritime insurance, and operational resumption of refineries and terminals in the Persian Gulf — a process that may take weeks to months.
What to Expect? The current scenario points to sustained unwinding of the risk premium, with Brent tending toward the USD 75–80/bbl range in the coming weeks as progress is made on reopening the strait. Full normalization of supply is expected to be gradual, given the timeline for mine clearance and logistical reactivation, thus providing some technical support to prices in the short term. If Friday’s ceremony fails to move toward concrete agreements about Iran’s nuclear program or Israel resumes military operations in Lebanon, volatility may intensify with a partial reversal of the recent decline.
Ukrainian Drone Attacks Hit Fuel Depots in Russia
Ukrainian drones ignited a fire at an oil depot in Russia’s Krasnodar region in the south on Tuesday (16), with no casualties reported. In the Yaroslavl region, a depot in Rybinsk remained ablaze following a strike recorded this past Sunday (14). Ukraine also destroyed two bridges connecting the Kherson region to Crimea on Monday (15), worsening the fuel crisis on the peninsula and causing runs at filling stations in Krasnodar.
Why it Matters: Crimea and Krasnodar were already facing fuel shortages before the latest attacks, and the additional disruption to logistics routes limits local resupply without material impact on global oil flows. The pattern of Ukrainian attacks on Russian energy infrastructure maintains a residual risk premium, but remains insufficient to reverse the downward trend driven by the US-Iran agreement.
What to Expect? Continued Ukrainian attacks on Russian energy infrastructure are expected to sustain regional disruptions in fuel supplies, without significantly altering the global oil balance. The impact on international prices remains marginal as the market’s focus is on the reopening process of the Strait of Hormuz.
- Should the attacks hit larger-scale export infrastructure — such as Black Sea terminals — there is a risk of Brent repricing. It is worth noting that, at the beginning of the month, Moscow announced a ban on jetfuel exports, underscoring the crisis caused by the escalation of Ukrainian strikes. In parallel, initial speculation pointed to a potential similar measure for diesel, although, to date, the Kremlin has not commented on the matter.
