Oil Monitor: Crude oil remains under pressure while product prices start to flatline at levels up 50% ytd

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Oil Monitor: Crude oil remains under pressure while product prices start to flatline at levels up 50% ytd

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02 Jul 2026 14:59:59 ET │ 34 pages

Oil Monitor

Crude oil remains under pressure while product prices start to flatline

at levels up 50% ytd

Francesco Martoccia AC

CITI'S TAKE +39-02-8906-4571

Fundamentals are rapidly reasserting themselves as Hormuz disruptions fade, with francesco.martoccia@citi.com

Brent back to the low $70s/bbl. While the US-Iran process remains fragile and AC Eric G Lee

disputes over Hormuz administration and transit fees persist, we expect the MOU to

+1-212-723-1474hold and turn into a deal over the coming months as incentives to de-escalate

outweigh the alternative for the US, Iran, and much of the ME region. Shipping flows eric.g.lee@citi.com

are normalizing, Chinese buyers remain absent, physical crude markets have AC Maximilian J Layton

weakened sharply, and inventories have drawn far less than expected. We continue +44-20-7986-4556

to recommend selling any summer rallies and forecast Brent reaching $60-65/bbl

max.layton@citi.comby the turn of the year.

Anthony Yuen AC

The US-Iran dealmaking process remains fragile but continues for now, as the +852-2501-2731

question of Strait of Hormuz tolls and administration remains contentious. Still, anthony.yuen@citi.com

we expect the MOU to hold, not because trust has suddenly emerged, but because

the incentives to break are poor for both sides (through this MoU and ultimately Xiaodan Zhu AC

through a deal Iran gets largely what it asked for, and the US gets acceptable +1-212-816-5109

global oil prices). After the weekend’s escalations, with Iran hitting two ships in the xiaodan.zhu@citi.com

Strait of Hormuz, the US responding with airstrikes on Iranian military facilities, and