On August 5th local time, Iran announced that it had reached a preliminary agreement with Oman on the shipping passage in the Strait of Hormuz. The two traditional shipping routes that have been in use for over 60 years will be shut down. Merchant ships will switch to a new temporary route passing through Iran's territorial waters. The operation mechanism of the Strait's shipping will undergo a fundamental change. Based on the current actual operation data, the number of ships passing through the Strait is still significantly lower than the normal level, and the shipping market remains in a "limited recovery" state. After the news was released, the risk premium in the energy trading market was quickly absorbed, and international crude oil closed down for the third consecutive trading day, with Brent crude oil falling below the $80 per barrel mark. 

The adjustment of shipping routes has reduced the geopolitical risk premium, significantly weakening the short-term upward momentum. 

The market anticipation of the adjustment of navigation passage rules directly led to a cooling of risk sentiment in the crude oil market, causing international crude oil to decline for the third consecutive trading day. On August 5th, the closing price of WTI crude oil was $75.22 per barrel, and Brent crude oil dropped to $79.45 per barrel, officially falling below the key integer level of $80. The previous accumulated long positions due to the obstruction of passage through the strait were concentratedly liquidated. 

The main driving force behind the initial rise in oil prices this round was concerns over the disruption of supply through the strait: Previously, due to restricted traffic, Brent crude oil had reached above $110. Market participants had already priced in the long-term supply gap of crude oil. When Iran and Iraq reached a new shipping channel agreement, the market expected that the strait would form a stable and predictable passage, and the geographical risk premium that had persisted for several months was quickly eliminated. Investors actively reduced their positions in the crude oil market, triggering a consecutive correction. 

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