Oil Retreats as Iran, Saudi Arabia and Oman Open Talks on the Strait of Hormuz

Crude prices eased on Tuesday despite the widening conflict, as diplomacy over the world's most important oil shipping chokepoint advanced. Brent futures fell about 3.9 percent to 84.91 dollars a barrel and United States West Texas Intermediate dropped about 3.3 percent to 79.87 dollars, after Iran's foreign minister, Abbas Araghchi, held separate calls with his Saudi and Omani counterparts about restoring security in the Strait of Hormuz. The relief was brief. By Wednesday, after American and Saudi forces struck Iran-aligned militias in Iraq and Iran launched ballistic missiles at United States forces, Brent had risen to about 89.53 dollars a barrel.

The strait remains central to the war's economic stakes. The Hindu noted that under a recent memorandum, the United States lifted its maritime blockade, issued a sanctions waiver for Iranian crude and promised Tehran access to some frozen funds, concessions that gave Iran a stake in keeping oil flowing even as it contests control of the passage. Iran has rejected an Omani proposal to divide oversight of the strait, keeping the dispute open.

The war has also accelerated a rerouting of global oil flows. India's Petroleum Ministry said its rising dependence on Russian barrels is deliberate, responding to reporting that Russia's share of Indian oil imports crossed 40 percent in May 2026. New Delhi framed the purchases of discounted Russian crude as a strategy to keep domestic fuel prices lower, a choice that also settles a growing share of oil trade outside Western channels.