Oil Drops as Iran Refuses to Meet U.S. Envoys in Qatar
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- Oil benchmarks slid roughly 0.9% intraday, with Brent at $72.27 and WTI at $68.91 a barrel, extending June's brutal selloff — Brent's largest monthly drop (~21%) since March 2020 and WTI's worst (20%+) since late 2021.
- Iran refused to meet U.S. delegates in Qatar, telling Reuters the two sides still need to finalize terms of the June 17 interim peace deal before tackling harder issues like nuclear-program limits.
- Jared Kushner and U.S. special envoy Steve Witkoff arrived in Doha on Tuesday, but a Qatari government spokesperson said they would meet mediators rather than Iranian officials directly.
- The 14-point memorandum of understanding signed June 17 paused fighting that had disrupted flows through the Strait of Hormuz, a chokepoint carrying about 20% of the world's oil traffic.
- Iranian state media reported Wednesday that a foreign container ship ran aground in the Strait of Hormuz while using a route Tehran had not approved.
- ING strategists Warren Patterson and Ewa Manthey said tanker movements through the Strait remain limited despite a slight pickup in inbound traffic, warning that an accelerating rebound 'becomes a clear headwind' to their view that oil prices should rise from current levels.
Why it matters: Oil absorbed its steepest monthly drop since 2020-21 in June — Brent down ~21% — on hopes a ceasefire would restore Strait of Hormuz supply. Iran's refusal to meet U.S. envoys in Qatar undercuts that outlook, with ING warning that further normalization of tanker traffic would challenge its view that prices should rise from current levels.
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