Crude Slides Nearly 9% as Traders Bet on Return of Iranian Oil
WTI crude fell nearly 9% last week as a US-Iran deal raised expectations of increased Iranian oil supply, removing geopolitical risk premium from the market.
Crude oil prices posted their steepest weekly decline in months as the August WTI contract settled at $75.22, down $7.22 or 8.73% from the prior week. The selloff was driven by a breakthrough agreement between the United States and Iran, which traders interpreted as a precursor to the return of Iranian barrels to global markets. The contract traded in a wide range between $81.00 and $72.83 before closing near the low end.
The removal of geopolitical risk premium was the dominant theme, as the market shifted focus from potential supply disruptions in the Persian Gulf to the prospect of additional supply. Iran has been under US sanctions that have kept roughly 1-1.5 million barrels per day of its production offline. Even a partial return of that volume could significantly alter the supply-demand balance, especially at a time when OPEC+ is already planning to unwind some production cuts. For fuel traders, the move underscores how quickly sentiment can shift when a major geopolitical overhang is removed. Check NowPrice's fuel page for the latest pricing on crude and refined products.
Looking ahead, the market will watch for concrete details on the timing and volume of Iranian oil exports. Any delays in implementation could trigger a short-term bounce, while a swift return would likely keep prices under pressure. Traders should also monitor weekly US inventory data and OPEC+ compliance, as these factors will determine whether the selloff has further room to run. The $72 area, near the week's low, may act as initial support, with a break below opening the door to the $70 handle.