Rising traffic in the Strait of Hormuz eases supply concerns; oil prices continue to fall on Friday

International oil prices continued to retreat on Friday, as signs of restored crude flow through the Strait of Hormuz eased supply concerns triggered by renewed US-Iran conflict. At the same time, markets were digesting US President Trump's push for increased tariffs on Iran, along with his statement to incorporate such measures into a bipartisan sanctions bill.

Oil prices continue their downward trend

The US West Texas Intermediate (WTI) September contract fell 1.62% to $82.24 per barrel; international benchmark Brent crude futures dropped 0.98% to $88.16 per barrel.

Earlier this week, exchange of fire between the US and Iran had temporarily driven oil prices higher, with Brent crude briefly surpassing $93 per barrel. However, as shipments through the Strait of Hormuz gradually resumed, market concerns about supply interruptions eased, and the war-risk premium faded.

Strait of Hormuz flow recovers

Commonwealth Bank of Australia noted in a Friday report that crude oil flow through the Strait of Hormuz has recovered to about 30% to 35% of pre-conflict levels, tempering market concerns about supply blockages.

The bank further stated that if traffic through the waterway returns to 50% to 60% of normal levels, the global crude oil market may once again tip into oversupply. This means that if the transport recovery trend continues, the recent price support fueled by geopolitical tension could weaken even more.

Trump pushes tariff inclusion

Aside from supply changes, investors are also assessing Trump's proposal to include tariffs against Iran in a bipartisan sanctions bill. The bill mainly targets Russia and parties supporting its war in Ukraine.

Trump said: "I want to see tariffs on Iran. This will make it stronger."

However, the market has also noticed that, although Congress generally supports sanctions against Russia and Iran, Trump has long regarded tariffs as a broad economic pressure tool, a stance that remains controversial on both political and policy levels.

Limited US-Iran trade volume

Data from the Office of the U.S. Trade Representative shows that the US imported only $1.4 million worth of goods from Iran in 2025. Trading Economics reports that art, collectibles, and antiques are the largest import category, accounting for 55% of the total.

From a market perspective, the resumed passage through the Strait of Hormuz means supply interruption risks have eased, putting short-term pressure on oil prices. However, if geopolitical tensions worsen again later, related risk premiums could resurface. Meanwhile, Trump's call for tariff-sanction linkage continues to keep the energy market under dual policy and geopolitical impact.