WTI Crude Settles at $70.34 as Hormuz Reopening Pushes Oil Into Permian Shale Breakeven Range

West Texas Intermediate crude oil settled at $70.34 per barrel on Tuesday, June 24, 2026, declining $1.87 from Monday's close after Strait of Hormuz transit resumed at reduced but functional capacity.

The session low of $69.63 per barrel marked a critical level, touching the lower bound of Permian Basin shale breakeven costs identified in the Dallas Federal Reserve Q1 2026 Energy Survey.

Hormuz Transit Resumes, Market Digests Supply Return

Iranian authorities announced partial resumption of commercial vessel transit through the Strait of Hormuz on Tuesday morning, ending a five-day disruption that had supported crude prices above $72 per barrel last week.

The International Energy Agency estimates 21 million barrels per day of crude and refined product flow through the strait annually. Even partial restoration of transit removed a near-term supply shock premium from futures contracts.

ICE Brent crude settled at $73.89 per barrel, a $3.55 premium to WTI, reflecting lingering uncertainty about full restoration of normal shipping schedules through the Persian Gulf corridor.

Permian Shale Breakeven Costs Come Into Focus

The Dallas Fed Q1 2026 Energy Survey reported average new well breakeven costs of $61 per barrel in the Midland Basin and $58 per barrel in the Delaware Basin for unconventional producers.

At Tuesday's intraday low of $69.63 per barrel, WTI traded only $8.63 above the upper Permian breakeven threshold. Survey respondents cited rising oilfield services costs and labor expenses as primary drivers of higher breakeven figures in 2026 compared to 2024.

Producers operating in higher-cost acreage positions face meaningful margin compression at current price levels, though most hedging programs provide near-term downside protection through Q3 2026.

WCS-WTI Differential Widens on Inventory Build

Western Canadian Select crude traded at an $18.75 per barrel discount to WTI on Tuesday, widening from $17.20 at last Friday's close. The shift followed the EIA's report of a 4.3 million barrel build in Cushing, Oklahoma crude inventory for the week ending June 20, 2026.

The Cushing build reflected increased pipeline nominations from the Bakken and Permian Basin amid weaker refinery run rates at Gulf Coast facilities undergoing scheduled maintenance turnarounds.

OPEC+ Compliance and Demand Outlook

OPEC+ production compliance slipped to 91 percent in May 2026, according to a secondary-source assessment reviewed by Reuters, as members including Iraq and Kazakhstan exceeded their allocated output ceilings.

The Joint Technical Committee is scheduled to convene in Vienna on July 10, 2026, to review Q2 compliance data and discuss whether voluntary production increases announced for Q3 will proceed as planned.

Global demand indicators remain mixed. Jet fuel demand in Southeast Asia continues recovering toward 2019 levels, while industrial diesel consumption in China remained below year-ago levels in May 2026, according to Kpler shipping data.

AER Rig Activity

The Alberta Energy Regulator reported 187 active drilling rigs in the province as of June 23, 2026, down from 204 active rigs during the corresponding week in 2025. Heavy oil and bitumen-focused rigs in the Cold Lake and Peace River regions accounted for 43 active permits.

The year-over-year rig count decline reflects operator caution at sub-$75 WTI prices rather than a structural retreat from Canadian heavy oil development, according to the Canadian Association of Petroleum Producers weekly activity summary.

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Sources and methodology: WTI settlement from CME Group June 24, 2026 closing data. ICE Brent settlement from Intercontinental Exchange June 24, 2026 closing data. Permian Basin breakeven costs from Dallas Federal Reserve Q1 2026 Energy Survey, published April 2026. Cushing inventory from EIA Weekly Petroleum Status Report week ending June 20, 2026. WCS-WTI differential from Net Energy Information Service daily posting. OPEC+ compliance from Reuters secondary-source assessment, May 2026. AER rig count from Alberta Energy Regulator weekly drilling activity report, June 23, 2026. Prices fetched at time of writing, Tuesday June 24, 2026.