🛢️ Global Oil Prices Dip as Strait of Hormuz Reopens Post US-Iran Peace Pact

Market Movement: Global oil prices fell on Friday following an interim peace agreement between the US and Iran, triggering the reopening of the strategic Strait of Hormuz. Brent crude: Fell by 43 cents (0.54%) to $79.42 a barrel. WTI crude: Slipped 17 cents (0.22%) to $76.43 a barrel (July contract). Supply Outlook: Multiple tankers—including three Saudi vessels carrying 6 million barrels—have commenced transit. Analysts project the deal could release over 85 million barrels of stranded Middle Eastern oil into global markets alongside the lifting of US sanctions on Iranian oil. Regional Updates: Kuwait Petroleum Corp lifted all wartime force majeure notices with immediate effect. Iraq confirmed its oilfields are ready to gradually restore previous production rates. Sri Lankan Context: Volatility in global oil prices directly impacts Sri Lanka's import bill and energy costs, heavily influencing domestic inflation and production costs for key export sectors like apparel & textiles and tea. Market Caution: Gains are capped by lingering geopolitical skepticism. Continued conflict between Israel and Hezbollah, alongside US VP JD Vance pulling out of scheduled talks in Switzerland, keeps analysts cautious regarding the long-term stability of the transit route.