MW U.S. oil prices fall below $74 a barrel on 60-day pause on Iranian oil sanctions
By Isabel Wang
Oil prices are down as hopes that more Iranian crude will hit the global market as supplies near critically low levels
Treasury Secretary Scott Bessent on Monday said the U.S. has authorized Iranian oil sales through August.
Oil prices fell on Monday, with the U.S. and international benchmarks on pace for their lowest levels since early March, after the Treasury Department waived sanctions on Iranian oil for 60 days as part of an interim agreement to end the conflict in the Middle East.
The most-active West Texas Intermediate contract for August delivery (CL.1) (CLQ26) was off 3%, at $73.60 a barrel, on pace for its lowest settlement level since March 2, the first trading day after the Iran war started on Feb. 28.
The U.S. benchmark has fallen for seven consecutive trading days and on Monday was headed for its longest losing streak since July 2025, according to Dow Jones Market Data.
The Brent crude contract for September delivery (BRN00) (BRNU26) was down 3.5% to $77.27 a barrel, also on track for its lowest level since March 2.
Oil traders reacted to encouraging signs that the world might avoid hitting a critically low level of crude supplies. That's mainly due to progress in peace talks between the U.S. and Iran over the weekend, although traffic through the Strait of Hormuz was still far below preconflict levels.
Treasury Secretary Scott Bessent said Monday that the U.S. has authorized Iranian oil sales through August following "productive talks" between Tehran and Washington in Switzerland over the weekend, according to a post on X.
Also in a joint statement early on Monday, mediators Qatar and Pakistan said that the U.S. and Iran had agreed to "a roadmap towards reaching a final deal within 60 days."
Traffic through the passage has increased since the U.S. and Iran signed a memorandum of understanding on June 17. Confirmed crossings rose sharply to 71 during the Juneteenth long weekend, according to data from marine traffic tracking platform Kpler.
"While this marks a significant recovery from recent lows, volumes were still 14 crossings below the previous weekend and remained below pre-crisis norms," said Kpler's Ana Subasic, trade risk analyst, and Yuan Li, junior risk and compliance analyst.
"Negotiations remained volatile over the weekend, even as the traffic recovery reflected the new interim framework," they wrote in a Monday client note.
The broader market cheered the sharp retreat in oil prices, with crude surrendering most of the gains triggered by the Iran war and approaching prewar levels. The national average for a gallon of regular gasoline dropped below $4 per gallon, at $3.9290 on Monday, according to the American Automobile Association.
That said, further downside in oil may be limited, said Fawad Razaqzada, global macro market analyst at StoneX.
"Prior to the war, WTI was trading in the $65-$66 per barrel region, an area that could provide meaningful support if prices continue to retreat," he told MarketWatch on Monday. "But the disruptions affecting the Strait of Hormuz over recent months has created a significant imbalance between supply and demand, tightening global markets and reducing available inventories."
As a result, even if WTI returns to prewar levels, "don't expect it to continue heading south," Razaqzada said.
-Isabel Wang
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(END) Dow Jones Newswires
June 22, 2026 11:57 ET (15:57 GMT)
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