Oil price hits lowest since early March despite doubts over how quickly strait of Hormuz will reopen – business live

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Over at the G7 summit in Évian-les-Bains, European allies don’t appear to share Donald Trump’s optimism that the strait of Hormuz will reopen by Friday.

One G7 official has told Bloomberg there are serious difficulties in finding a common position among the group about how to deal with the situation in Iran.

One senior US official said traffic in the waterway would ramp up over time, and it could take as many as two weeks for shipping to significantly increase — and even longer for it to return to the levels seen before the US and Israel attacked Iran in February.

There are mines in the strait that still need to be cleared and shippers have different risk tolerances about navigating Hormuz, the official said.

Bosses of the world’s biggest shipping companies want to see more than just an agreement in place, mines need to be swept, and all hostilities must end, before tankers with hundreds of millions of dollars’ worth of cargo will be able to traverse the Strait without fear of a flare up in tensions that could close the Strait mid-voyage.

Thus, even if a deal is signed to end the US/Iran war, the situation is not without its challenges. Brent crude remains above $80 per barrel, and it is unlikely to fall below this level until we start to see cargo ships successfully get through the Strait.