Oil prices experienced a significant decline following the US decision to grant a 60-day waiver permitting Iranian oil exports, FX Street reported. This move effectively eased some of the supply constraints that had been supporting higher prices.
According to ING analysts Warren Patterson and Ewa Manthey, the waiver intensified downward pressure on oil markets by increasing flows through the Strait of Hormuz, a critical chokepoint for global energy shipments. The additional supply from Iran contributed to a more bearish sentiment among traders.
For Japanese markets, where energy import costs heavily influence inflation and corporate earnings, the drop in oil prices may provide some relief amid ongoing economic uncertainties.