Crude oil prices closed out May with their steepest monthly decline since 2020, even as geopolitical uncertainty around the U.S.-Iran standoff kept markets on edge. According to Ship & Bunker, Brent crude fell more than 2% on Friday to $91.61 per barrel, while West Texas Intermediate dropped by a similar margin to $86.73 — capping a monthly decline of more than 20% for Brent and approximately 19% for WTI.
A Month of Sharp Declines Amid Fragile Diplomacy
The sustained downward pressure on oil throughout May reflects growing investor optimism that a diplomatic resolution between Washington and Tehran remains within reach — despite persistent signs of mistrust on both sides. Ship & Bunker reports that even following a 60-day ceasefire extension ratified in the previous session, tensions have not eased significantly. Iran’s claim of shooting down a U.S. aircraft was publicly refuted by Washington, and U.S. President Donald Trump has continued to demand that Tehran clear the Strait of Hormuz without charging tolls and surrender its nuclear materials.
On Friday, Trump reportedly withdrew to the Situation Room to make what he described as a “final determination” on next steps with Iran, according to Ship & Bunker.
Hormuz Disruption Keeps Supply Constrained
Despite the price decline, physical supply through the Persian Gulf remains severely disrupted. UBS analysts cited by Ship & Bunker noted that crude loadings inside the Gulf stayed “extremely low,” with Iran’s May loadings falling below 0.3 million barrels per day — a sharp drop from 1.7 million bpd recorded in March.
Bob Parker, senior advisor at the International Capital Markets Association, offered a cautious outlook. Even if the Strait reopens, he told Ship & Bunker, “that opening will only be partial,” and he suggested oil prices would likely remain between $90 and $100 per barrel “at least for the next couple of months” until U.S.-Iran talks produce clearer outcomes.
Major Energy Companies Refuse Iran Toll Demands
Leading energy companies have taken a firm stance on Iran’s reported toll requirements for Hormuz passage. Chevron CEO Mike Wirth told Ship & Bunker that his company would not consider paying a toll to move its vessels through the strait, adding that new ship attacks this week confirmed that risks in the area remain very real. Chevron currently has six chartered vessels operating within the Persian Gulf, according to the report.
Exxon Mobil Senior Vice President Neil Chapman highlighted mounting pressure on global inventories, stating: “We’re approaching unheard-of inventory levels,” as quoted by Ship & Bunker.
Shadow Trade Continues
In a separate development reported by Ship & Bunker, tanker-tracking data from Kpler and Vortexa showed the Philippines received its first cargo of Iranian crude oil in May. A Suezmax vessel that departed from Kharg Island in late March conducted a ship-to-ship transfer offshore Singapore before delivering the oil to the Bataan refinery in mid-May.
The Reserve Bank of India, in its Annual Report cited by Ship & Bunker, flagged that the global supply disruption poses near-term downside risks to growth and upside risks to inflation, while maintaining a positive outlook for India’s domestic economy in 2026–27.
Does This Matter to You?
For vessel operators, charterers, and bunkering professionals active in the Persian Gulf or reliant on Hormuz transit routes, the combination of volatile crude prices and severely constrained loadings out of Iran represents an ongoing operational and commercial risk. The sharp drop in crude prices may appear to offer relief on bunker costs, but analysts quoted by Ship & Bunker caution that Hormuz uncertainty continues to support elevated price floors. Operators with vessels positioned in or around the Gulf — like Chevron’s six chartered ships — face real exposure to ongoing attack risks and potential toll demands. Bunkering strategy and supply planning for the remainder of the year may need to account for continued price uncertainty until clearer diplomatic outcomes emerge.
Gulf Bunkering does not provide operational or security guidance. This article is for informational purposes only. Operators should consult flag state authorities, P&I clubs, and relevant advisories for decisions relating to transit planning.
Sources: Ship & Bunker
