Brent Crude Plunges Over 7% As US-Iran Pause Eases Supply Concerns

Global crude oil prices came under heavy selling pressure on Monday, with major oil benchmarks plunging by more than 7 per cent after the United States and Iran paused military strikes over the weekend, raising hopes of a diplomatic breakthrough.

International benchmark Brent crude dropped by more than 7 per cent, or around $7, to trade near $91 per barrel, while US West Texas Intermediate (WTI) crude also declined by over 7 per cent, falling about $6.4 to below $85 per barrel.

The sharp correction followed signals from Iran that it would refrain from further attacks provided the United States also suspended military operations.

The development eased fears of an immediate escalation in the conflict and improved expectations of a negotiated settlement.

The decline came after a strong three-week rally that briefly pushed Brent crude above $100 per barrel, driven by concerns that tensions in West Asia could disrupt global oil supplies through the Strait of Hormuz and the Bab el-Mandeb Strait, two of the world’s most important energy shipping routes.

Despite Monday’s steep fall, market experts cautioned that geopolitical risks remain elevated. They pointed to recent attacks claimed by Iran-backed Houthi forces on Saudi Aramco facilities at the Red Sea ports of Jizan and Yanbu, indicating that threats to global energy infrastructure continue.

Analysts said crude oil prices remain nearly 40 per cent higher this month despite the latest correction, while shipping through the Strait of Hormuz has yet to fully normalise.

The Indian rupee rose 41 paise to 96.15 against the US dollar, marking its strongest opening gain in nearly two months.

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