Oil Prices Continue to Weaken at the Start of the Week

Global oil prices moved lower on Monday morning (22/6/2026), continuing a sharp correction from last week as concerns over Middle Eastern supply disruptions subsided. According to Refinitiv data as of 09:15 Western Indonesia Time, Brent crude stood at US$79.48 per barrel, down 1.35% from Friday’s close of US$80.57 per barrel. West Texas Intermediate (WTI) crude was at US$76.46 per barrel, edging down 0.18% from the previous position of US$76.60 per barrel. This movement extends a correction phase that began in mid-June. On 10 June, Brent was still perched at US$93.10 per barrel and WTI at US$90.03 per barrel, meaning Brent has shed roughly 14.6% of its value in less than a fortnight, while WTI has dropped around 15%. The heaviest pressure came from shifting market expectations regarding global supply. Over recent weeks, market participants had feared distribution disruptions stemming from the Iran-Israel conflict and uncertainty in the Strait of Hormuz, the artery of global energy trade. Reuters reported that oil prices plunged more than 8% last week as markets began pricing in the return of supply previously held back in the Persian Gulf region. Additionally, hopes emerged that US sanctions on Iranian oil exports could be eased as part of an ongoing negotiation process. Nevertheless, tensions have not fully abated. Iran again announced the closure of the Strait of Hormuz over the weekend, citing violations of a peace agreement by Israel and the United States. Kpler reported that ship traffic through the strait plummeted sharply. On Sunday, only five vessels were recorded transiting, far fewer than the 26 ships the previous day. This decline in shipping activity serves as a fresh alarm for global energy markets. The Strait of Hormuz is the world’s most strategic oil shipment route, where millions of barrels from Saudi Arabia, the United Arab Emirates, Kuwait, Iraq, and Iran flow to markets in Asia, Europe, and America. MST Marquee Head of Energy Research Saul Kavonic assessed that the market may have been too quick to assume the Strait of Hormuz would return to normal operations. He noted that Iran still has an incentive to maintain pressure on the shipping lane as it remains a key bargaining chip in ongoing geopolitical negotiations. Uncertainty also emerged from the first talks between US and Iranian officials in Switzerland. The meeting, which was hoped to be an initial step towards resolving the conflict, did not proceed smoothly. US President Donald Trump even threatened to continue attacks on Iran if diplomatic developments did not meet Washington’s expectations. On the supply side, several Middle Eastern producers have begun opening taps wider. The United Arab Emirates, Kuwait, and Iraq were reported to have offered additional oil volumes to buyers over the past week. Iraq even plans to gradually increase production to a range of 4.2-4.3 million barrels per day. At the same time, Iran stated that more than 25 million barrels of its oil had successfully passed the virtual blockade line since early last week. This supply flow has reduced market fears of a short-term oil shortage.