Oil prices are set to record a fourth consecutive weekly loss, influenced by the reopening of the Strait of Hormuz and increased oil flows. Brent and WTI crude prices have dropped significantly, nearing pre-war levels, with Brent in the low $70s and WTI under $70 per barrel. Market expectations are bolstered by a U.S.-Iran memorandum aimed at increasing supply, causing the Brent futures curve to enter contango, indicating less concern about immediate supply shortages. Saudi Arabia has ramped up oil exports, shipping over 10 million barrels through the Strait of Hormuz recently. Overall market sentiment has turned bearish, with some analysts suggesting the market is oversold.

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Oil Set for Fourth Straight Weekly Loss as Hormuz Flows Return

Tsvetana Paraskova

Fri, July 3, 2026 at 6:00 AM EDT2 min read

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Oil futures were on track to post their fourth consecutive weekly loss early on Friday as the tentative reopening of the Strait of Hormuz and the uptick in oil flows weigh down prices.

In Asian trade early on Friday, with U.S. markets closed for the July 4 weekend, both benchmarks, Brent and WTI, were gaining about 0.5% on some profit-taking.

Over the past three weeks, prices have slumped to nearly pre-war levels, with Brent now in the low $70s per barrel and WTI Crude trading below $70.

The U.S.-Iran memorandum to negotiate a deal and the reopening of the Strait of Hormuz have prompted hopes that immediate physical supply will jump in the coming weeks and ease concerns about shortages, especially in Asia.

The supply picture is improving, according to the Brent futures curve, ING's commodities strategists Warren Patterson and Ewa Manthey wrote in a report on Friday.

"The increase in oil flows is putting growing pressure on the front end of the ICE Brent forward curve," they said.

The forward curve is moving further into contango, the market structure in which prices for contracts dated further out in time are higher than the prompt contracts. This type of curve suggests that concerns about the immediate lack of crude supply have eased significantly.

Gulf producers, including Iran, are now rushing to ship oil out of the Strait of Hormuz, until the negotiation window expires in August, with uncertainties beyond that.

Saudi Arabia is estimated to have pushed over 10 million barrels of crude out of the Strait of Hormuz in recent days, as supertankers continue to load oil from the Saudi port of Ras Tanura in the Persian Gulf and Saudi Arabia is ramping up oil exports to Asia.

In the weeks since the U.S. and Iran announced the MoU, market sentiment has turned decisively bearish, some analysts say too bearish as oil is in oversold territory.

By Tsvetana Paraskova for Oilprice.com

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