US President Donald Trump announced that Iran is 'agreeing to everything I want' regarding ongoing negotiations, claiming the country is making 'very big concessions' in recent developments. Speaking about the latest developments, Trump stated 'Iran is agreeing to everything I want,' and warned that 'Iran has to agree, otherwise we'd just go back and do what we have to do.' The President also revealed that Iran has informed the US that there would be no tolls in the Strait of Hormuz and mentioned that some Iranian funds would be released. Trump claimed that the strait is now fully open under a recent agreement and emphasized that oil prices are 'plummeting' and could soon lead to gasoline prices falling to around USD 2.5 per gallon. These developments come as oil prices continue to trade under pressure, with Brent crude trading at USD 72.77, lower by USD 0.97 or 1.32 per cent.
J.P. Morgan has updated its Brent crude oil price forecast for 2026, lowering expectations due to unexpectedly weaker inventory draws and a decline in oil demand. The bank now estimates Brent prices will average $86 in Q3 and $80 in Q4, finishing the year at $78, down from previous projections. According to J.P. Morgan, OECD commercial inventory draws have come in below expectations, while demand losses have been larger than expected, implying materially less upward pressure on oil prices. The bank noted that oil flows are currently running at roughly 8.6 million barrels per day and have averaged 6.3 million barrels per day so far in June, materially above April and May levels. Private operators have largely refused to draw down oil stocks, relying almost entirely on government SPR releases to keep refinery gates open.
Oil prices have slipped near the $70 mark for the first time since US-Iran conflict began on February 28, 2026, creating significant pressure on Indian energy sector stocks. US West Texas Intermediate crude traded at USD 69.50, down USD 0.84 or 1.19 per cent, while Brent crude traded at USD 72.77, lower by USD 0.97 or 1.32 per cent. Indian oil explorers face particular challenges as crude prices slip, with stocks such as ONGC, Oil India, Vedanta and HOEC likely to see negative impact as lower crude prices reduce realizations and profitability. A USD 5 per barrel fall in crude can lead to a 7–12 per cent decline in earnings per share for companies like ONGC and Oil India. However, oil marketing companies stand to benefit from the fall in crude prices, with HPCL, BPCL and IOCL may see improved margins as input costs decline. Every Rs 0.5 per litre change in fuel margins can impact EBITDA by around 7–11 per cent, supporting earnings when crude prices move lower.
The recent US sanctions waiver on Iran could add further barrels to the market, though Redoglia expects a small geopolitical risk premium to remain for now. Following the 17 June memorandum of understanding (MoU) between the United States and Iran, global energy markets are entering a new phase of adjustment. The waiver will allow Iran to sell oil stored in tankers and move more crude into global markets. "The MoU signed by the US and Iran on June 17 may signal the beginning of recovery, but while it answers some questions it also creates more," said Burkhard, noting that Iran has promised to provide 60 days of free passage for ships using the Strait of Hormuz, but what happens after that? The durability of the US-Iran deal — which also involves Lebanon — will be challenged by deep levels of mistrust between the two sides, with implementation not expected to be smooth and steady. The MoU already faces a mixed political reception in the US, adding uncertainty to the recovery process. The reopening of the Strait of Hormuz is expected to facilitate the recovery of energy flows, though market normalisation and inventory replenishment will take time.
Oil prices have remained highly volatile, with concerns mounting over potential supply disruptions at the Strait of Hormuz, a critical maritime chokepoint that handles nearly 20 per cent of global oil flows, heightening inflation risks for economies worldwide. The current price movement represents a significant shift from earlier highs, as earlier on April 30, Brent climbed near a multi-year high of USD 126 a barrel, gaining nearly 7 percent intraday, while before, on March 9, Brent crude surged over 27 per cent to trade at a multi-year high of USD 119 a barrel amid escalating West Asia tensions. Despite recent volatility, J.P. Morgan expects OECD inventories to continue drawing by an additional 50 million barrels between April and July, with the bank projecting production would likely need to be curtailed in early 2027, following a period of maximized output in late 2026. The convergence of technical levels suggests prices will continue to swing based on weekly balance between physical inventory levels and diplomatic developments in the Middle East.
