The oil-price shock unleashed by this year's Iran war has faded. Crude has fallen to levels last seen before the fighting began, Al Jazeera reported, unwinding a surge that rattled global energy markets and forced fuel-dependent industries into months of improvisation.
Back to where it started
Brent crude, the international benchmark, slipped to around $72 a barrel in late June, near its lowest since February 27 — the eve of the conflict — while US West Texas Intermediate traded just under $70, according to Al Jazeera. Prices ticked back above $74 at points in the week but remained close to pre-war levels. The decline was driven less by any single event than by the expectation of rising supply: producers across the Middle East have been increasing output, and Iran is set to boost sales after a temporary easing of US sanctions.
Crucially, the waterway at the center of the crisis is flowing freely again. US Energy Secretary Chris Wright told an industry forum that traffic through the Strait of Hormuz — the narrow passage that carries roughly a fifth of the world's seaborne oil — was close to pre-war volumes, with more than 20 million barrels having exited the strait in a single recent 24-hour period.
The shock that preceded the calm
The contrast with the spring could hardly be sharper. When the war erupted in late February and shipping through Hormuz was disrupted, crude spiked sharply, and the cost of refined products — gasoline, diesel and jet fuel — climbed with it. CNBC, which tracked the market through the conflict, chronicled how prices whipsawed on each turn in the fighting and the diplomacy around it.
Refiners that depend on Persian Gulf crude were among the most exposed. With Gulf cargoes harder to obtain, some processors looked to alternative suppliers in the Americas and elsewhere — a switch that is rarely simple, because refineries are calibrated for particular grades of crude and must adjust to different densities and sulfur levels.
Airlines feel it most directly
Few industries are as sensitive to fuel costs as aviation, where jet fuel is one of the largest single expenses. As prices surged during the war, carriers around the world responded by trimming flight schedules and raising fares to protect thin margins, Al Jazeera reported. The pullback in capacity rippled across summer travel plans in North America, Asia, Europe and Australia.
With crude now back near pre-war levels, that pressure is easing. Whether airlines pass the savings on to passengers is another question: fares tend to rise quickly when costs spike and fall more slowly once they recede. For now, the return of cheaper, more reliable oil has lifted an immediate threat from the world economy — though the episode was a sharp reminder of how quickly a distant conflict can reach the fuel tank and the airfare.
