Oil Prices Fall as Strait of Hormuz Access Improves, U.S. Considers Supply Boost
Oil prices declined on Friday, March 20, 2026, as international efforts to secure safe passage through the Strait of Hormuz gained traction and the United States signaled potential moves to increase global oil supply. The developments offer a respite from soaring energy costs that have been fueled by geopolitical tensions in the Persian Gulf.
U.S. Actions to Stabilize Oil Prices
U.S. Treasury Secretary Scott Bessent indicated the U.S. Is considering removing sanctions on Iranian oil currently held on tankers, potentially unlocking additional supply for the global market. He also suggested a further release of crude from the U.S. Strategic Petroleum Reserve remains a possibility as reported by CNBC. This comes after the U.S. Has been allowing Iranian oil tankers to transit the Strait of Hormuz to help supply the rest of the world .
International Cooperation for Safe Passage
A joint statement released on Thursday by Britain, France, Germany, Italy, the Netherlands, and Japan signaled a commitment to contribute to efforts ensuring safe passage through the Strait of Hormuz, a critical waterway for global oil and LNG transit. Approximately 20% of the world’s oil and LNG passes through the strait according to the Washington Examiner. This follows initial hesitation from some European nations.
Market Reaction and Price Movements
Brent futures experienced a decline, falling $1.24, or 1.1%, to $107.41 a barrel as of 0148 GMT. U.S. West Texas Intermediate (WTI) crude also decreased, dropping $1.24, or 1.3%, to $94.90. Despite the daily decline, benchmark Brent is still on track to increase by over 4% for the week, following Iranian attacks on oil and gas facilities in Gulf states that led to production shutdowns. WTI, however, is expected to fall nearly 4% this week, marking its first weekly decline in five weeks. The spread between WTI and Brent is currently at its widest point in 11 years.
U.S. Diplomacy with Israel
President Donald Trump stated he advised Israeli Prime Minister Benjamin Netanyahu against further attacks on Iranian energy infrastructure, and that Netanyahu has agreed to refrain from such actions.
Increased U.S. Domestic Oil Production
Crude oil output in North Dakota is projected to rise in March and subsequent months as operators restart previously inactive wells and winter restrictions are eased as reported by The Hill. However, the North Dakota Department of Mineral Resources cautioned that the pace of increased activity will depend on sustained high oil prices and existing budgetary constraints of major oil companies.
Recent Tanker Traffic
Tanker traffic through the Strait of Hormuz had previously plunged due to Iranian attacks on commercial ships in the Persian Gulf. However, Iranian ships have continued to export approximately 1.5 million barrels of oil per day through the strait despite the U.S. Navy presence . Indian and some Chinese tankers have also successfully transited the strait recently.