Oil falls as supply starts moving through Strait of Hormuz

PERTH (Reuters) – Oil prices fell on Friday on the prospect of more supply returning to the market after oil tankers began to move through the ​Strait of Hormuz following the signing of the U.S.-Iran interim peace deal._x000D_
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Brent ‌crude futures fell 54 cents, or 0.68%, to $78.31 a barrel as of 0146 GMT. U.S. West Texas Intermediate crude slipped 46 cents, or 0.60%, to $76.14 a barrel. The front-month July contract expires on ​Monday. The more actively traded August contract was at $75.06 a barrel, down ​79 cents._x000D_
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Both benchmarks touched their lowest since early March on Thursday as ⁠several tankers, including three Saudi-flagged vessels with 6 million barrels of crude onboard, sailed ​through the strait hours after U.S. President Donald Trump signed a deal with ​Iran to end their war._x000D_
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Analysts expect the deal to release more than 85 million barrels of oil stranded in the Middle East Gulf into global markets. The agreement also includes the lifting ​of U.S. sanctions on Iranian oil which would add more supply._x000D_
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“Traders are still waiting ​for hard evidence that tanker traffic through the Strait of Hormuz is actually normalising before committing ‌to ⁠the next leg lower,” KCM Chief Market Analyst Tim Waterer said._x000D_
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“Until those ships start moving consistently again, scepticism lingers and keeps a lid on the downside.”_x000D_
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Prior to the war, roughly one-fifth of the world’s oil and liquefied natural gas transited ​through the strait, ​and analysts have ⁠suggested trade could return to normal in the coming months if the U.S.-Iran deal holds._x000D_
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Middle East producers are also gearing ​up to resume exports._x000D_
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Kuwait Petroleum Corp said on Thursday that ​all force ⁠majeure notices issued during the war have been lifted with immediate effect._x000D_
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Iraq’s Oil Minister Basim Mohammed said the country’s oilfields are ready to resume production and a ⁠return to ​normal output levels will take place gradually until ​previous production rates are restored._x000D_
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However, Israel has continued its war against Hezbollah in Lebanon, raising questions about ​whether the U.S.-Iran peace agreement would hold.