Oil prices back to pre-war levels on rising Middle East supply

The price of Brent crude has reached its lowest since February 27, before the war started.Oil prices have extended their decline to levels last seen before the start of the Iran-war" class="entity-link entity-event" data-entity-id="38748" data-entity-type="event">Iran war, as expectations of rising supply from the Middle East outweighed demand concerns.Prompt-month Brent crude futures for August delivery fell $1.06 (1.44 percent) to $72.68 a barrel by 06:39 GMT, while US West Texas Intermediate (WTI) lost 76 cents (1.08 percent) to $69.58 a barrel.Recommended Stories list of 4 itemslist 1 of 4Has the worst of the Hormuz crisis passed?list 2 of 4Oil prices rise as Lebanon fighting erupts and Hormuz traffic still slowlist 3 of 4Oil prices fall, stocks rally as US, Iran sign framework to end warlist 4 of 4Will a US-Iran deal transform the Iranian economy?end of listBoth contracts hit their lowest since February 27.August Brent was trading lower than September, which was priced at $73.59, signalling ample short-term supply.Brent had fallen by more than $3 on Wednesday as supply concerns eased, while WTI settled down nearly $3.US Energy Secretary Chris Wright told a forum that flows through the Strait of Hormuz were close to those before the start of the Iran-war" class="entity-link entity-event" data-entity-id="38748" data-entity-type="event">Iran war, with at least 20 million barrels having exited the strait in the past 24 hours.A return to complete normality would take a few weeks, however, because the strait needs to be cleared of mines, he added.Rising Middle East supply, together with Iran set to boost sales after a temporary reprieve from US sanctions, drove down prices of physical crude oil cargoes around the world.New routesAn initial accord last week to end the US-Israeli war with Iran, which began on February 28, has allowed the resumption of traffic through the strait.The accord set up a 60-day period of negotiations to tackle tougher issues, such as Iran’s nuclear programme.Wright said oil would continue to flow through the strait even if the deal did not hold, and that Iran would not be able to close it again.Tehran has said it plans to impose what it calls maritime service fees, as opposed to tolls, while the United States argues it is an international waterway and therefore should not be charged.