Global oil prices are set to post a sharp weekly decline after positive developments in US-Iran relations helped restore trade flows through the Strait of Hormuz.
The strategic route is one of the world's most important oil shipping lanes, and the restoration of ship traffic in the area has eased concerns about global supply disruptions.
West Texas Intermediate (WTI) crude oil was trading around US$77 a barrel, its lowest since early March after falling nearly 10% during the week. Brent crude was trading below US$80 a barrel.
The price drop came as previously stranded ships began moving out of the Strait of Hormuz, while Kuwait announced plans to increase its oil production.
The US military also confirmed that restrictions on ship movements to and from Iranian ports had been lifted.
At the same time, international maritime watchdogs advised ships to use routes near the Omani coast to avoid the risk of mines that may still be present in the area.
The move helped boost market confidence in the safety of oil shipments.
US President Donald Trump welcomed the development, saying that the market reacted positively when oil prices fell while stocks rose.
The drop in oil prices has also erased much of the gains that had been made since the conflict between the United States, Israel and Iran erupted in February.
The Strait of Hormuz has been a hotbed of tension because it handles about a fifth of the world's oil supply. Any disruption in the area could have a major impact on global energy markets.
While concerns remain about the future of US-Iran relations, the current recovery in shipping and oil supplies is seen as helping to stabilise oil prices and reduce pressure on the global economy.
