Global Oil Prices Continue to Fall as Shipping Through Strait of Hormuz Returns to Normal

Global oil prices continued to fall during the week ending June 18, 2026, as shipping activity through the Strait of Hormuz increased following a preliminary agreement between the United States and Iran.

According to the latest Central Bank of Kenya (CBK) Weekly Bulletin released on Friday, June 19, 2026, easing tensions in the Middle East has helped lower commodity prices and reduce inflation risks globally.

The CBK reported that Murban crude oil prices dropped to USD 74.41(Ksh 9,623) per barrel from USD 84.60 (Ksh 10,941) per barrel a week earlier.

The decline followed a ceasefire deal and improved relations between the US and Iran, which eased fears of disruptions to global oil supplies.

More Ships Passing Through the Strait of Hormuz

The Strait of Hormuz is one of the world’s busiest oil shipping routes, with a large share of global oil exports passing through it.

US President Donald Trump, on Friday, June 19, said shipping traffic through the Strait had increased significantly.

“Such a large number of ships are passing through the Strait of Hormuz; this has never been seen before,” Trump said.

Also Read: CBK Holds Interest Rate at 8.75% as Inflation Jumps and Global Oil Prices Surge

He added that about 700 ships were moving through the route, carrying oil to global markets. Trump said the increased supply could push oil prices even lower in the coming weeks.

The US Navy also confirmed that ships can now pass through the southern route of the Strait of Hormuz without special coordination, a sign that security concerns in the area have eased.

CBK Says Inflation Pressures Have Eased

The CBK said lower oil prices and reduced geopolitical tensions have helped ease inflation pressures around the world.

The regulator noted that major central banks, including the US Federal Reserve and the Bank of England, kept their lending rates unchanged during the week as risks from the Middle East reduced.

Lower global oil prices could also benefit fuel-importing countries such as Kenya by reducing the cost of fuel imports and easing pressure on consumer prices.

Kenya Shilling Remains Stable

Meanwhile, the Kenyan shilling remained stable against major international and regional currencies.

The shilling exchanged at Ksh129.55 per US dollar on June 18, compared to Ksh129.48 on June 11.

Kenya’s foreign exchange reserves remained strong at USD 13.15 billion, equivalent to 5.6 months of import cover. This is above the CBK’s minimum requirement of four months.

Diaspora remittances remained an important source of foreign exchange. However, inflows fell slightly to USD 394.2 million in May from USD 397.8 million in April.

Investors Continue Buying Government Securities

Investor demand for government securities remained strong during the week.

The June 18 Treasury bill auction received bids worth Ksh 49 billion against the government’s target of Ksh 24 billion.

Also Read: EPRA Announces Fuel Prices for June–July Cycle

Similarly, reopened 20-year and 25-year Treasury bonds attracted bids totaling Ksh 77.6 billion against an advertised amount of Ksh 60 billion.

At the Nairobi Securities Exchange (NSE), share prices continued to rise. The NASI, NSE 25, and NSE 20 share indices increased by 2.57 percent, 3.68 percent, and 1.90 percent, respectively.

Bond market activity also improved, with secondary market turnover increasing by 14.91 percent during the week.

The CBK said global commodity prices are likely to remain under pressure if stability in the Middle East continues and oil supplies remain strong through the Strait of Hormuz.

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US President Donald Trump speaking at a past event. PHOTO/White House