Oil slid to a six-week low to end the month of May. On May 29, oil futures traded at prices not seen since mid-April. Energy traders continued to price in for the U.S. and Iran agreeing on a preliminary deal that would reopen the Strait of Hormuz.
Bitcoin (BTC-USD) also traded on that scenario. BTC-USD traded at the $73,500 level. The Iranian regime received cryptocurrency payments when it charged a toll for safe passage. Presumably, the U.S. would negotiate a reopening that would not permit such tools.
Iran’s Fars news agency implied that the country would still charge fees for traversing the Strait. It said any agreement would be “according to its own pre-determined arrangements.”
Running Out of Time
The oil shock that followed the bombing of Iran faded, thanks to various economic buffers. That included countries drawing down from oil that were shipped before the Strait closed. Still, Iran’s attacks on neighboring refineries did not continue. That gave the energy market hope that resuming operations after the Strait’s re-opening would happen quickly.
The oil boom’s status is unclear. Energy markets are on a holding pattern, unsure if the oil price boom will hold. Exxon Mobil (XOM) is at a support price of around $145. Shell Plc (SHEL), however, is forming a downtrend. SHEL stock closed at $84.12, down from its peak of $94.90 in April.
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