CRUDE oil prices fell below US$68 a barrel on Thursday, hitting their lowest level since late February as rising shipments through the Strait of Hormuz and signs of progress in indirect talks between the United States and Iran eased concerns over global supply disruptions.
A US official said crude flows through the strategically important waterway had climbed above 10 million barrels per day with support from the American military, signalling a further normalisation of exports after recent regional tensions.
The United Arab Emirates has also restored oil exports to pre-conflict levels through alternative shipping arrangements, while Iranian crude exports surged above 40 million barrels following the lifting of a US naval blockade.
Additional supply pressure came from Russia, where record crude shipments contributed to a sharp increase in global seaborne oil inventories.
Market sentiment was also supported by diplomatic developments after US President Donald Trump welcomed progress in indirect negotiations with Iran, while Qatar said another round of talks would be convened as soon as possible.
However, Tehran maintained its position that it would retain maritime administrative control over the Strait of Hormuz, leaving a key source of geopolitical uncertainty unresolved.
In currency markets, China's yuan traded little changed against the US dollar as investors awaited June's US non-farm payrolls report, a key indicator expected to influence expectations for future Federal Reserve interest rate decisions.
The onshore yuan was last quoted at 6.7865 per US dollar, while the offshore yuan strengthened modestly to 6.7895 during Asian trading after both traded within narrow ranges.
The US dollar also remained broadly steady, with the dollar index holding at 101.37 as markets awaited employment data forecast to show the US economy added around 110,000 jobs in June while the unemployment rate remained at 4.3 per cent.
Analysts at MUFG said uncertainty surrounding the Federal Reserve's evolving policy framework could increase volatility across Asian currencies in the near term.
They added that China's upcoming Politburo meeting is likely to be a key domestic driver for the yuan this month, with further economic support measures potentially underpinning gradual appreciation against the US dollar.
Before markets opened, the People's Bank of China set the yuan's daily midpoint at 6.8088 per dollar, weaker than the previous session's more than three-year high and 159 pips below Reuters' market estimate.
China's central bank has consistently fixed the midpoint at weaker-than-expected levels to moderate the pace of the yuan's appreciation, traders and analysts said.
Meanwhile, the official trade-weighted CFETS yuan index rose to 102.88, its highest level since July 2022, reflecting the currency's broader strength against a basket of major trading partners' currencies. - July 2, 2026
