Brent Crude Falls Below $70 as Iran-US Ceasefire Reopens the Strait of Hormuz
- ▸Brent crude fell below $70 a barrel on July 1, 2026, after a US-Iran memorandum of understanding signed June 18 ended the conflict and reopened the Strait of Hormuz.
- ▸The EIA expects an adjustment period through Q3 2026, followed by a return to oversupply — inventory builds of 2.7 million barrels/day in Q4 2026 and 5.0 million barrels/day in 2027.
- ▸Damage to LNG liquefaction infrastructure in Qatar is expected to cause a cumulative loss of around 120 billion cubic meters of LNG supply between 2026 and 2030, a longer-lasting effect than the oil-price shock.
Brent crude fell below $70 a barrel on July 1, 2026 — landing almost exactly where it stood before Iran and Israel exchanged fire in late February. That round trip is the direct result of a memorandum of understanding signed by the United States and Iran on June 18, which ended the four-month conflict and reopened the Strait of Hormuz, the chokepoint through which roughly a fifth of the world's oil trade normally passes.
The speed of the price reversal is itself notable. Global oil markets adjusted trade flows and cut demand faster than most forecasters expected, with the bulk of that demand reduction concentrated in Asia — the region most dependent on Middle Eastern crude. Gulf producers also rerouted supply around Hormuz, non-Middle East exporters raised output, and the US and other OECD governments released strategic reserves to cushion the gap.
India is one of the world's largest importers of both Middle Eastern crude and LNG, which put it directly in the path of the conflict-driven price spike between February and June 2026. The reopening of the Strait of Hormuz and the return of Brent to pre-conflict levels is a direct relief to India's import bill and current account. The lasting LNG supply damage out of Qatar is the part of this story India's energy planners will need to watch longest, given India's growing reliance on LNG imports to meet rising gas demand.
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Cite This Article
Khagan Rao. (2026, July 13). Brent Crude Falls Below $70 as Iran-US Ceasefire Reopens the Strait of Hormuz. EconoLens. https://econolens.co.in/news/brent-oil-below-70-iran-us-ceasefire-july-2026
Khagan Rao is an economist and analyst specialising in global monetary policy, fiscal frameworks, and international trade. He tracks publications from the IMF, World Bank, BIS, and RBI to deliver accessible, data-driven analysis for a global audience.