Oil Prices Climb Towards $100 As Ceasefire Extension Clouds Market Outlook

Global oil prices moved higher on Wednesday, approaching the $100-per-barrel mark, as investors assessed the implications of extended US-Iran diplomatic efforts and ongoing disruptions in a key shipping corridor.

Brent crude futures rose 0.82 per cent to $99.29 per barrel, while US West Texas Intermediate (WTI) advanced 1.15 per cent to $90.71. Both benchmarks had already recorded gains of roughly 3 per cent in the previous trading session.

In contrast, domestic crude prices on the Multi Commodity Exchange (MCX) slipped during early trade. The commodity touched an intraday low of Rs 8,382, marking a decline of 0.65 per cent, or Rs 55, around 10:30 AM.

Market sentiment remained guarded following US President Donald Trump’s decision to prolong a tentative ceasefire with Iran indefinitely, replacing an earlier two-week timeline.

The move is intended to create space for continued negotiations, though uncertainty persists.

Restricted movement through the Strait of Hormuz compounded concerns, as the crucial passage carries nearly one-fifth of global energy supplies.

Reports indicated limited shipping activity over the past 24 hours, with vessel traffic largely stalled.

Trump, in a social media statement, asserted that Iran’s economy was under severe strain, estimating daily losses of $500 million. He also suggested that Tehran was eager to restore normal operations in the Strait.

At the same time, Iran has signalled that it may attempt to challenge the ongoing naval blockade. This development adds to geopolitical tensions. It also contributes to volatility in energy markets.

Equity markets reflected the uncertain backdrop. Indian benchmark indices declined by about 1 per cent, weighed down by losses in IT, banking, and automobile stocks, including Infosys, HCL Tech, Tech Mahindra, ICICI Bank, HDFC Bank, Eicher Motors, and M&M.

Global markets presented a mixed picture. Japan’s Nikkei index rose 0.61 per cent, while Hong Kong’s Hang Seng fell 1 per cent and South Korea’s KOSPI edged lower.

In the United States, Wall Street ended the session in the red. The S&P 500 dropped 0.63 per cent to 7,064. The Nasdaq declined 0.6 per cent to 24,259.96.

Investors continue to monitor developments in the Middle East closely. Geopolitical risks and supply constraints shape the trajectory of oil prices.

Also Read: New Delhi Set For Heatwave Spell As Temperatures Climb Close To 44°C