Oil prices fell on Wednesday as markets awaited more cues on U.S.-Iran talks after Washington flagged progress in ongoing negotiations. 

Brent oil futures for July, the global crude benchmark, sank by 2.5% to $109.25 a barrel by 04:44 ET (08:44 GMT), while U.S. West Texas Intermediate crude futures dropped 1.9% to $102.35 a barrel. Both contracts declined by about 1% on Tuesday. 

Two Chinese-flagged supertankers carrying oil exited the Strait of Hormuz on Wednesday, raising hopes for a renewal to supply flows through the vital waterway, Reuters reported, citing LSEG and Kpler shipping data. South Korean-flagged Very Large Crude Carrier Universal Winner is also leaving the narrow conduit off of Iran’s southern coast, which has been effectively closed to tanker traffic since the start of the U.S.-Israeli war on Iran in late February.

U.S. President Donald Trump also told lawmakers on Tuesday evening that the Iran war could end "very quickly." He had earlier this week said he postponed a planned attack against Iran, and that negotiations with Tehran were going well.  

Separately, Vice President JD Vance also struck an optimistic tone on the Iran war, stating that Tehran wanted to make a deal. 

Iran, in its latest peace proposal earlier this week, called for ending hostilities on all fronts, the exit of U.S. forces from the region, and reparations for damage from the war, state media reported on Tuesday. The U.S. had largely rejected Iran’s prior offers, arguing that ending the country’s nuclear ambitions remained a key demand in any negotiation. 

U.S. stockpile data awaited 

Markets are now awaiting upcoming U.S. inventory data for more cues on oil stockpiles in the face of continued supply disruptions.

Data from the American Petroleum Institute showed a 9.1 million barrel (mb) draw last week, much bigger than expectations for a 3.4 mb draw. The API data usually heralds a similar print from official inventory data, which is due later on Wednesday. 

U.S. inventories are expected to have been drawn down sharply in recent weeks, as the country ramped up oil exports to offset overseas supply shocks. Trump has ordered the release of 172 million barrels of oil from the Strategic Petroleum Reserve to stem supply shocks from the Iran conflict.