(Investing) – Oil prices extended losses on Wednesday, retreating for a third straight session as signs of a gradual reopening of the Strait of Hormuz and improving U.S.-Iran relations eased fears of a prolonged disruption to Middle East energy supplies.At 09:43 ET (13:43 GMT), Brent crude futures expiring in September, the global oil benchmark, slipped 4% to $73.71 a barrel. Notably, U.S. West Texas Intermediate crude futures expiring in August dipped 4.4% to $69.98 a barrel, falling below the $70 mark for the first time since March 2.Both benchmarks settled around four-month lows in the previous session.Market sentiment was shaped by evidence that shipping activity through the Strait of Hormuz is steadily recovering following a months-long conflict that had disrupted one of the world’s most important energy chokepoints.Reports showed that several previously stranded supertankers have successfully exited the Gulf carrying crude cargoes, while a growing number of Qatar-linked liquefied natural gas vessels have resumed voyages through the waterway.The movements are being viewed by traders as an early sign that regional energy flows are normalizing.U.S. and Iranian negotiators have agreed to a 60-day roadmap aimed at reaching a broader settlement, while Washington has granted a temporary sanctions waiver allowing certain Iranian oil exports to resume through August.The developments have raised expectations of additional crude supplies returning to global markets.“Estimates suggest that roughly 6-7m b/d of oil moved through the strait in recent days, which is still far below pre-war flows of around 20m b/d. However, with pipeline diversions for Saudi Arabia and the UAE, we only need to see oil flows through the strait return to around 14m b/d for oil supply from the Persian Gulf to return to pre-war levels,” ING analysts said in a note.“We continue to believe that the oil sell-off is overdone, with the market still tightening. Clearly, price movements suggest the market expects a fairly rapid recovery in Persian Gulf oil supplies,” they added.Investors also assessed U.S. inventory data from the American Petroleum Institute (API). U.S. crude inventories declined by 765,000 barrels in the week ended June 19, compared with analysts’ expectations for a larger draw.Crude stocks at the WTI delivery hub, Cushing, fell by 1 million barrels. Gasoline and distillate fuel oil stocks increased by 1.2 million barrels and 1.4 million barrels, respectively.Traders are awaiting official inventory figures from the U.S. Energy Information Administration (EIA) later on Wednesday for confirmation.Maria Ponnezhath and Anuron Mitra contributed to this article