Oil prices fall as Hormuz traffic recovers to 30-35% of normal

Oil prices declined on July 31, 2026, as a recovery in crude traffic through the Strait of Hormuz reduced supply fears. West Texas Intermediate for September delivery fell 1.62% to $82.24 a barrel, and Brent crude dropped 0.98% to $88.16 a barrel.

The price retreat followed a period of heightened tension after U.S.-Iran hostilities had briefly pushed Brent above $93 a barrel earlier in the week. Commonwealth Bank of Australia noted in a Friday report that stronger flows through the key waterway had calmed market nerves.

The bank estimates that Hormuz traffic has rebounded to roughly 30%-35% of pre-war levels. It added that a further recovery to around 50%-60% of normal flows could restore oversupply conditions in global oil markets.

Investors also assessed President Donald Trump's call to add tariffs on Iran to a bipartisan sanctions bill aimed at Tehran and Russia. Trump said, "I'd like to see tariffs on Iran. It would make it much stronger," referring to the legislation that would impose economic sanctions on Russia and its supporters in the Ukraine war.

The bill would also allow Trump to levy targeted tariffs on goods from the top five countries that buy Russian energy and help it evade sanctions. While sanctions against Iran and Russia have broad congressional support, Trump's preference for tariffs as an economic tool remains divisive.

U.S. imports from Iran totaled just $1.4 million in 2025, according to the Office of the U.S. Trade Representative. Works of art, collectors' pieces, and antiques made up 55% of that value, Trading Economics data shows.