ICE Brent Drops to $72.80 as Doha Talks Drive Hormuz War-Premium Selloff
Crude has surrendered nearly $40 from May's $111 peak as US-Iran diplomatic engagement accelerates the unwind of the Hormuz supply disruption premium.
ICE Brent crude front-month futures fell to $72.80 on Monday (2026-06-29) after traders drove oil lower the previous Tuesday (2026-06-23) on reports of possible US-Iran talks in Doha — the latest catalyst in a selloff that has now erased nearly $40 from the contract's May peak.6
The retreat tells a specific story. When Brent reached $111 in mid-May, the market was pricing three to seven million barrels per day of sustained Hormuz disruptions, with some participants holding out for outages above ten million, according to a Bloomberg Intelligence survey conducted at the time. That supply-shock premium is now unwinding faster than many anticipated.5,1
The physical market moved first. On Wednesday (2026-05-20), three commercial supertankers carrying a combined six million barrels of Middle East crude cleared the Strait of Hormuz — the first meaningful tanker transits through the waterway in more than two months. Universal Winner, a South Korean-flagged very large crude carrier hauling two million barrels of Kuwaiti crude, was already en route to SK Energy's Ulsan refinery. Yuan Gui Yang, a Chinese-flagged vessel carrying Iraqi Basrah crude and chartered by Sinopec's trading arm Unipec, headed toward Guangdong province. A third tanker, Ocean Lily, carried two million barrels of Qatari crude toward Asian discharge ports.4
Prices did not stabilize once Hormuz began moving again. Each successive diplomatic signal — Trump's warning to Iran in mid-May, then the pivot toward Doha talks in late June — gave traders successive permission to trim long positions accumulated during the conflict.3,6
The Bloomberg Intelligence survey, conducted when prices were above $100, found a majority of market participants expecting ICE Brent to average $81 to $100 per barrel over the next twelve months. Both bounds of that range now sit above spot. If Doha produces any framework for easing restrictions on Hormuz commercial traffic, the downside for the next quarter becomes material.1
US production adds structural weight. The EIA projects American crude output will reach a record 14.1 million barrels per day by 2027, a baseline set before the conflict and now reinforced by the elevated prices that made marginal US barrels viable during the Hormuz closures. If Gulf supply recovers and American shale continues its build-out, the inventory tightness that justified triple-digit prices dissipates quickly.1
Emergency stock operations complicate the picture further. The EIA reported that the United States drew nearly 10 million barrels from its Strategic Petroleum Reserve in the week of May 11 — the largest single-week withdrawal on record. Those barrels are now in the market. As Hormuz reopens, demand for further SPR releases disappears, but the inventory those releases created still needs to be absorbed.2
NYMEX WTI crude front-month was at $70.42 on Monday (2026-06-29). [live prices] FXEmpire noted that the downside remains "still limited" while the diplomatic situation stays unresolved — precisely the qualifier traders will watch as Doha talks develop.6 A ceasefire or formal agreement to reopen Hormuz to full commercial traffic would remove the residual war premium, and the supply backdrop — US output growth, recovering Gulf flows, the SPR overhang — offers little to replace it.