Oil posts largest quarterly drop since 2008 as Hormuz reopens

Brent crude posted its biggest quarterly plunge since 2008 after the U.S. and Iran signed a June 17 framework to reopen the Strait of Hormuz, according to Reuters.reuters+1
Shipping traffic surged over 50% in the final week of June, though weekend strikes and a vessel attack near Oman showed the recovery remains fragile.aa+1
Analysts say oil now carries near-zero geopolitical risk premium, with Goldman Sachs targeting Brent at $71 by Q4 and JPMorgan holding a $60 baseline.oilprice+1

Crude oil prices closed out the second quarter on Tuesday with their steepest quarterly decline in years, as a US-Iran ceasefire and the tentative reopening of the Strait of Hormuz deflated months of war-driven price spikes. Brent crude fell more than 20% in June alone and dropped roughly $45 a barrel over the quarter, according to Reuters, bringing prices back near pre-conflict levels around $73 a barrel.oilprice

The plunge marks a dramatic reversal for a market that had been roiled since late February, when US and Israeli military operations against Iran triggered the first operational closure of the Strait of Hormuz in modern history. At its peak in early May, Brent crude traded above $110 a barrel.morningstar+1

Ceasefire Unlocks Shipping

The slide accelerated after the United States and Iran signed a framework agreement on June 17 calling for the immediate reopening of the strait to commercial traffic and a 60-day negotiating window for a permanent deal, according to AP News. Under the memorandum of understanding, the US agreed to lift its naval blockade of Iranian ports while Iran pledged to reopen the waterway.aljazeera

Traffic responded quickly. Kpler data showed 343 ships transited the strait in the week of June 22-28, up more than 50% from 223 the prior week. On June 24, AXS Marine recorded 62 commercial vessel crossings — the highest single-day count since the war began, though still only about 53% of normal levels.aa+1

Recovery Remains Fragile

The rebound has been uneven. A four-day exchange of strikes between US and Iranian forces late in the month caused traffic to plunge again over the weekend, with just 22 vessels passing on Sunday compared to 38 the previous day. The International Maritime Organization paused its evacuation plan for roughly 600 stranded ships and 11,000 mariners after a container ship was struck by a projectile near Oman on June 25. The IMO's website listed 47 confirmed incidents in the strait and surrounding region as of June 26.nytimes+3

Analysts Recalibrate

Market participants are now pricing in near-zero geopolitical risk premium, with Brent at about $70 a barrel reflecting "close to zero geopolitical risk premium," according to OilPrice.com. A Reuters poll in late May had forecast Brent averaging $90.44 for 2026, but the June selloff has overtaken those projections. Goldman Sachs The Goldman Sachs Group, Inc. had set a Q4 Brent target of $71, while JPMorgan maintained a more bearish full-year baseline of around $60.reuters+2

On Wednesday, oil ticked slightly higher as concerns lingered that a breakdown in final-status talks could extend disruptions. The 60-day negotiating clock is now running, and the strait — while busier — remains a contested space.reuters

Sources (27)