Crude futures ended the day, month, and quarter lower on Tuesday as traffic through the Strait of Hormuz picked up following U.S.-Iran talks. Front-month Nymex crude for August delivery plunged 31.4% during the second quarter to $69.50 a barrel, and front-month Brent August crude sank 38.4% to $72.92 a barrel, the largest quarterly percentage decline for both benchmarks since the first quarter of 2020. For the month, U.S. and Brent crude fell 20.4% and 20.8% respectively. Goldman Sachs expects a normalization of flows through the strait by the end of July, leading to oversupply, while Morgan Stanley now models an implied global oil market surplus of 4.8 million barrels a day in 2027 and cut its fourth-quarter 2026 Brent forecast to $75 a barrel from $80. The Energy Information Administration reported U.S. crude oil production climbed to a record 13.93 million barrels a day in April, as producers responded to the price spike triggered by the Middle East war and the strait's closure.
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Morgan StanleyBrent crude futures fell 38.4% in Q2 due to expected oversupply from resumed Strait of Hormuz flows and record U.S. production.
WTI crude futures fell 31.4% in Q2 due to expected oversupply from resumed Strait of Hormuz flows and record U.S. production.