The prospect of a decrease in oil prices and the re-opening of the Strait of Hormuz weakens the risk premium.

As expectations for the reopening of the Strait of Hormuz continue to eliminate geopolitical risk premiums in the market, oil prices have fallen. In early trading in European markets, Brent crude fell 0.5% to $82.75 per barrel, while West Texas Intermediate futures fell 0.3% to $80.52 per barrel. As shipowners and traders await further details of the US-Iran agreement scheduled to be signed on Friday, futures prices have seen a pullback but remain significantly higher than pre-conflict levels. However, both benchmark crude oils have fallen by about 9% this week. Goldman Sachs analysts stated, "Although the full details of the agreement are not yet clear, we now assume that Gulf exports will return to pre-war levels by the end of July." The bank has lowered its oil price forecast, now expecting an average price of $85 per barrel for Brent crude in the fourth quarter, lower than the previously announced forecast of $90 per barrel.