Oil prices were little changed Thursday after Vice President J.D. Vance announced that more than 12 million barrels of tankers had passed through the Strait of Hormuz overnight.
“This is the highest amount since the conflict began,” Vance told reporters at a White House press briefing. CNBC could not immediately confirm the number. Before the Iran war, approximately 14 million barrels of oil per day and 6 million barrels of refined products passed through Hormuz.
brent crude oil Futures, an international benchmark, rose 30 cents to close at $79.85 a barrel. E.T. West Texas Intermediate Futures It fell 19 cents to settle at $76.60 per barrel. Prices have fallen more than 11% since the United States and Iran announced a deal on Sunday aimed at ending the war.
President Donald Trump signed a deal with Iran’s Masoud Pezeshkian on Wednesday. Under the agreement, Iran must allow ships to pass through Hormuz without paying tolls for 60 days, while the United States must lift its naval blockade.
“For the second night in a row, the Iranian side did not fire on any vessels in the Strait of Hormuz,” Vance told reporters. “So far, they have complied with their end of the bargain.”
“Regarding the naval blockade, Centcom has allowed more than a dozen ships to pass through our naval blockade to the North, so we will also respect the termination of the earlier part of the agreement,” the vice president said. Centcom then announced that the US had lifted the blockade.
Ship tracker Kpler had not observed a significant increase in traffic as of Thursday morning. Three Saudi tankers carrying 6 million barrels have been spotted in the Gulf of Oman. Before the Iran war, more than 100 ships passed through the strait every day, dozens of them tankers.
“The floodgates haven’t opened and there hasn’t been a mass spill yet,” said Matt Smith, head of commodity research at Kepler. Smith said shippers remain hesitant to cross Hormuz.
Veteran oil analysts have warned that the opening of Hormuz will not necessarily solve massive supply disruptions. Rapidan Energy President Bob McNally said the data showed a huge hole in oil supplies and inventories, and the market would face a liquidation later this year.
The deal between the United States and Iran is actually a temporary ceasefire, McNally told CNBC. “This is nothing short of a hefty ransom payment for at least some 65 million barrels locked up inside Hormuz,” he said.
McNally, who served as senior energy adviser to President George W. Bush, said Trump hopes the deal will allow Gulf Arab states to increase production and avoid the summer supply shortages that analysts have warned about.
“He bought time. He bought oil,” the analyst said. “Let’s see if that takes hold and leads to the rebalancing, the recirculation of supplies that he wants.”
Amrita Sen, founder of Energy Aspects, said the oil market does not trade on fundamentals and hasn’t in recent months. Sen said the market was missing the fact that crude oil inventories were at record lows, an event that would normally force prices to rise.
Rather, traders are focused on what will happen when Hormuz reopens, although shipping traffic is unlikely to return to pre-war levels, analysts told CNBC.
“Everything will be more gradual,” Sen said. “Of course, initially there will be some stranded ships, but it won’t return to pre-conflict levels overnight.”
—CNBC’s Hugh Leask contributed to this report.
