US sees Iran oil exports hitting 2M bpd as SPR release continues

The US expects Iran's crude exports to reach 2 million barrels a day while releasing 172 million barrels from the Strategic Petroleum Reserve, a supply injection that has pushed Brent crude back toward pre-war levels near $72 a barrel.

"The Iran export forecast reflects the reopening of the Strait of Hormuz after the US-Iran ceasefire deal," US Energy Secretary Chris Wright said at the Reuters Global Energy Forum in New York on Wednesday, adding that some 20 million barrels of crude had exited the strait in the prior 24 hours.

Brent crude fell 4.7% to $73.37 a barrel on Wednesday, its lowest since before the Feb. 28 US-Israeli strikes on Iran, and extended losses to $72.40 in Asian trading Thursday. WTI crude slid 3.9% to $70.34. The 11-session decline has erased 22.8% from Brent since its March peak of $119, when the conflict risk premium was at its maximum.

For India, the world's third-largest crude importer, every $10 decline in the import bill saves about $12 billion to $15 billion annually, easing pressure on the current account and giving the Reserve Bank of India more room to keep borrowing costs supportive of growth. The 60-day US-Iran negotiation window that expires in August will determine whether the supply normalization proves durable.

Hormuz Flows Recover as Tanker Logjam Clears

At least 20 oil tankers carrying 35 million barrels that had been stranded in the Persian Gulf since March have exited the Strait of Hormuz since the US-Iran interim deal reopened the waterway, according to Kpler data. Confirmed oil shipments through the strait have risen to about 4.8 million barrels a day, the highest since the conflict began, though still well below the pre-war average of 15 million.

The US Navy lifted its blockade of Iran on June 18, and the Treasury Department waived sanctions on Iranian oil sales through August. The Joint Maritime Information Center downgraded the Hormuz threat level to "moderate" from "critical," saying an attack is "possible but not likely."

Iran's Revolutionary Guards warned Thursday that safe passage through the strait is only possible via routes designated by Tehran, and that action would be taken against vessels that fail to comply. A Panama-flagged crude tanker made a U-turn Thursday after being instructed to take the northern Iranian route, according to British maritime security company Ambrey.

Supply Surge Reshapes Market Dynamics

The US SPR release adds 172 million barrels to global supply at a time when commercial inventories are already building. The combination of Iranian export recovery and strategic stockpile sales has compressed the geopolitical risk premium that had pushed Brent above $119 in March.

For US energy companies, the dual supply surge has weighed on share prices. Exxon Mobil, Chevron, ConocoPhillips and SLB all fell more than 2% on Wednesday. For Asian importers, the relief is more direct: Japan's Nikkei surged 3.7% Thursday on lower energy costs, while Indian auto and aviation stocks rallied on margin expectations.

The International Maritime Organization said Tuesday it would implement an evacuation plan for more than 11,000 seafarers still stranded in the Persian Gulf, backed by Iran, Oman, the US and other Gulf states. The 60-day negotiation period will determine whether the current supply normalization becomes permanent or proves temporary, with markets pricing in continued uncertainty about the durability of the ceasefire framework.

This article is for informational purposes only and does not constitute investment advice.