Oil prices fell more than 1 per cent on Monday after OPEC+ announced a larger-than-expected production increase for August, fuelling fears of oversupply at a time when markets are already weighing the risks of slowing demand and economic uncertainty.&nbsp;According to Reuters, the group of oil producers, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, agreed over the weekend to raise output by 548,000 barrels per day (bpd) next month. That figure exceeds previous monthly increases and caught many traders off guard.<h2>Brent and WTI both under pressure</h2>Brent crude futures slipped 80 cents, or 1.2 per cent, to US$67.50 a barrel in early trading, while US West Texas Intermediate (WTI) crude dropped by US$1.32, or 2 per cent, to US$65.68. Analysts said the announcement reflects OPEC+’s willingness to compete more aggressively for market share, even if that means accepting lower prices.&nbsp;“The increased production clearly represents a more aggressive competition for market share and some tolerance for the resulting decline in price and revenue,” said Tim Evans of Evans Energy in a note cited by Reuters.<h2>A significant jump from earlier targets</h2>The decision marks a notable acceleration in production growth. For comparison, OPEC+ had been adding around 411,000 bpd each month for May, June and July. The new target for August is a significant jump from those previous monthly increases and from the 138,000 bpd boost seen in April.OPEC+ justified the move by pointing to a steady global economic outlook and what it described as healthy market fundamentals, including relatively low oil inventories. According to Reuters, the group appears confident that demand can absorb the additional barrels despite lingering concerns over global economic conditions.<h2>Saudi Arabia signals demand confidence</h2>Saudi Arabia, the de facto leader of OPEC, underscored that confidence by raising the official selling price for its flagship Arab Light crude for August deliveries to Asia. Reuters reported this marks a four-month high for the grade, signalling Riyadh’s belief in robust demand from the region despite broader market jitters.&nbsp;Meanwhile, RBC Capital Markets analysts led by Helima Croft noted that nearly 80 per cent of the 2.2 million bpd of voluntary cuts pledged earlier by eight OPEC producers would effectively be reversed with the new decision. However, they also cautioned that in practice, much of the recent supply increases have come primarily from Saudi Arabia, while other members have struggled to ramp up production as planned.<h2>Looking ahead to September</h2>According to Reuters, Goldman Sachs analysts expect OPEC+ to confirm a final planned increase of about 550,000 bpd for September when the group next meets on 3 August. Markets will be watching closely to see whether the bloc sticks to its roadmap or adjusts strategy in response to price movements and demand signals.<h2>Wider backdrop of trade tensions</h2>Oil markets are also navigating the broader economic backdrop, including the prospect of renewed trade tensions as the US prepares to impose higher tariffs on many trading partners.&nbsp;As per Reuters, US President Donald Trump said on Sunday that several trade deals were close to being finalised and that letters would soon be sent to countries facing steeper tariff rates from 1 August, after a temporary pause ends on 9 July. The interplay between production policy, global demand forecasts and geopolitical trade tensions is expected to remain a key driver of oil prices in the weeks ahead.&nbsp;(With inputs from the agencies)&nbsp;

Brent and WTI crude fell sharply as OPEC+ announced a 548,000 bpd production boost for August, exceeding expectations and raising concerns over surplus and slowing demand in a volatile economic climate.

Oil prices fell more than 1 per cent on Monday after OPEC+ announced a larger-than-expected production increase for August, fuelling fears of oversupply at a time when markets are already weighing the risks of slowing demand and economic uncertainty. According to Reuters, the group of oil producers, which includes the Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, agreed over the weekend to raise output by 548,000 barrels per day (bpd) next month. That figure exceeds previous monthly increases and caught many traders off guard. Brent and WTI both under pressure Brent crude futures slipped 80 cents, or 1.2 per cent, to US$67.50 a barrel in early trading, while US West Texas Intermediate (WTI) crude dropped by US$1.32, or 2 per cent, to US$65.68. Analysts said the announcement reflects OPEC+’s willingness to compete more aggressively for market share, even if that means accepting lower prices. “The increased production clearly represents a more aggressive competition for market share and some tolerance for the resulting decline in price and revenue,” said Tim Evans of Evans Energy in a note cited by Reuters. A significant jump from earlier targets The decision marks a notable acceleration in production growth. For comparison, OPEC+ had been adding around 411,000 bpd each month for May, June and July. The new target for August is a significant jump from those previous monthly increases and from the 138,000 bpd boost seen in April. OPEC+ justified the move by pointing to a steady global economic outlook and what it described as healthy market fundamentals, including relatively low oil inventories. According to Reuters, the group appears confident that demand can absorb the additional barrels despite lingering concerns over global economic conditions. Saudi Arabia signals demand confidence Saudi Arabia, the de facto leader of OPEC, underscored that confidence by raising the official selling price for its flagship Arab Light crude for August deliveries to Asia. Reuters reported this marks a four-month high for the grade, signalling Riyadh’s belief in robust demand from the region despite broader market jitters. Meanwhile, RBC Capital Markets analysts led by Helima Croft noted that nearly 80 per cent of the 2.2 million bpd of voluntary cuts pledged earlier by eight OPEC producers would effectively be reversed with the new decision. However, they also cautioned that in practice, much of the recent supply increases have come primarily from Saudi Arabia, while other members have struggled to ramp up production as planned. Looking ahead to September According to Reuters, Goldman Sachs analysts expect OPEC+ to confirm a final planned increase of about 550,000 bpd for September when the group next meets on 3 August. Markets will be watching closely to see whether the bloc sticks to its roadmap or adjusts strategy in response to price movements and demand signals. Wider backdrop of trade tensions Oil markets are also navigating the broader economic backdrop, including the prospect of renewed trade tensions as the US prepares to impose higher tariffs on many trading partners. As per Reuters, US President Donald Trump said on Sunday that several trade deals were close to being finalised and that letters would soon be sent to countries facing steeper tariff rates from 1 August, after a temporary pause ends on 9 July. The interplay between production policy, global demand forecasts and geopolitical trade tensions is expected to remain a key driver of oil prices in the weeks ahead. (With inputs from the agencies)

Oil prices dropped over 1% after OPEC+ surprised markets with a bigger-than-expected output hike, stoking oversupply fears amid global demand uncertainty.

Oil prices slide as OPEC+ surprises with bigger August output hike

Oil prices slipped on Thursday after a strong rally in the previous session, as traders weighed the looming threat of higher US tariffs, signs of faltering demand in major economies, and expectations that OPEC+ will announce an output increase at its upcoming meeting. According to Reuters, Brent crude futures fell 45 cents, or 0.65 per cent, to $68.66 a barrel by 0645 GMT. US West Texas Intermediate (WTI) crude declined 44 cents, or 0.66 per cent, to $67.01 a barrel.&nbsp;The losses follow a roughly 3 per cent surge on Wednesday, when prices hit their highest level in a week. That rally was driven by geopolitical jitters after Iran suspended cooperation with the United Nations nuclear watchdog, fuelling fears the long-running dispute over its nuclear programme could spiral into armed conflict. Additionally, a preliminary trade deal between the US and Vietnam offered some support to sentiment.<h2>Tariff uncertainty clouds demand outlook</h2>However, attention has now turned back to the uncertain outlook for global demand, with traders wary of fresh tariff risks. As per Reuters, the US is nearing the end of a 90-day pause on higher tariffs, which is set to expire on 9 July. Without new trade agreements in place with major partners such as the European Union and Japan, there is growing concern that Washington could reimpose steeper duties.&nbsp;Analysts fear such a move could slow global trade and dampen fuel demand. ING analysts, cited by Reuters, noted that with both the tariff deadline and the US Independence Day holiday weekend approaching, many market participants will be reluctant to maintain large positions, reducing appetite for risk.<h2>OPEC+ expected to raise output</h2>The production outlook is also weighing on prices. According to Reuters, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, collectively known as OPEC+—are widely expected to agree to raise output by 411,000 barrels per day at their meeting this weekend.&nbsp;Such an increase would add to global supply at a time when demand signals are already flashing warnings, potentially putting further pressure on prices in the weeks ahead.<h2>Demand concerns deepen on China, US data</h2>Reuters also reported that demand worries were compounded on Thursday by weaker-than-expected economic data out of China, the world’s biggest oil importer. A private-sector survey showed service-sector activity in China expanded at its slowest pace in nine months in June, with domestic demand weakening and new export orders declining.&nbsp;Meanwhile, in the US, the world’s largest crude consumer, official data revealed a surprise build in inventories last week. The Energy Information Administration said crude stocks rose by 3.80 million barrels to 419 million barrels, defying analyst expectations in a Reuters poll for a drawdown of 1.80 million barrels. Weekly gasoline demand also fell to 8.6 million barrels per day, raising fresh concerns about consumption during the peak US summer driving season.<h2>Eyes on US jobs data, Fed outlook</h2>Traders are also awaiting key economic data to gauge the health of the US economy and the likely path of interest rates. Reuters noted that markets are keenly watching Thursday’s release of the US monthly employment report, which could help shape expectations around the depth and timing of potential Federal Reserve rate cuts later this year.&nbsp;Lower interest rates could stimulate economic activity, which would be expected to support oil demand. However, signs of a cooling labour market may complicate that outlook. A private payrolls report released on Wednesday showed a contraction for the first time in two years, though analysts cautioned there is no direct correlation with the government’s official data.

Crude prices slip after a brief rally, pressured by weak China and US demand data, looming US tariff hikes, and anticipated OPEC+ supply increases.

Oil prices slipped on Thursday after a strong rally in the previous session, as traders weighed the looming threat of higher US tariffs, signs of faltering demand in major economies, and expectations that OPEC+ will announce an output increase at its upcoming meeting. According to Reuters, Brent crude futures fell 45 cents, or 0.65 per cent, to $68.66 a barrel by 0645 GMT. US West Texas Intermediate (WTI) crude declined 44 cents, or 0.66 per cent, to $67.01 a barrel. The losses follow a roughly 3 per cent surge on Wednesday, when prices hit their highest level in a week. That rally was driven by geopolitical jitters after Iran suspended cooperation with the United Nations nuclear watchdog, fuelling fears the long-running dispute over its nuclear programme could spiral into armed conflict. Additionally, a preliminary trade deal between the US and Vietnam offered some support to sentiment. Tariff uncertainty clouds demand outlook However, attention has now turned back to the uncertain outlook for global demand, with traders wary of fresh tariff risks. As per Reuters, the US is nearing the end of a 90-day pause on higher tariffs, which is set to expire on 9 July. Without new trade agreements in place with major partners such as the European Union and Japan, there is growing concern that Washington could reimpose steeper duties. Analysts fear such a move could slow global trade and dampen fuel demand. ING analysts, cited by Reuters, noted that with both the tariff deadline and the US Independence Day holiday weekend approaching, many market participants will be reluctant to maintain large positions, reducing appetite for risk. OPEC+ expected to raise output The production outlook is also weighing on prices. According to Reuters, the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, collectively known as OPEC+—are widely expected to agree to raise output by 411,000 barrels per day at their meeting this weekend. Such an increase would add to global supply at a time when demand signals are already flashing warnings, potentially putting further pressure on prices in the weeks ahead. Demand concerns deepen on China, US data Reuters also reported that demand worries were compounded on Thursday by weaker-than-expected economic data out of China, the world’s biggest oil importer. A private-sector survey showed service-sector activity in China expanded at its slowest pace in nine months in June, with domestic demand weakening and new export orders declining. Meanwhile, in the US, the world’s largest crude consumer, official data revealed a surprise build in inventories last week. The Energy Information Administration said crude stocks rose by 3.80 million barrels to 419 million barrels, defying analyst expectations in a Reuters poll for a drawdown of 1.80 million barrels. Weekly gasoline demand also fell to 8.6 million barrels per day, raising fresh concerns about consumption during the peak US summer driving season. Eyes on US jobs data, Fed outlook Traders are also awaiting key economic data to gauge the health of the US economy and the likely path of interest rates. Reuters noted that markets are keenly watching Thursday’s release of the US monthly employment report, which could help shape expectations around the depth and timing of potential Federal Reserve rate cuts later this year. Lower interest rates could stimulate economic activity, which would be expected to support oil demand. However, signs of a cooling labour market may complicate that outlook. A private payrolls report released on Wednesday showed a contraction for the first time in two years, though analysts cautioned there is no direct correlation with the government’s official data.

Oil prices dip as demand concerns, US tariff risks, and expectations of an OPEC+ output hike offset geopolitical tensions.

Oil prices slip as US tariff deadline, OPEC+ output hike loom

The prices of commercial LPG gas cylinders were revised by the oil marketing companies on Tuesday (July 1, 2025), reducing the cost of a 19 kg commercial cylinder by Rs 58.50. The slash in the price will come into effect from July 1, 2025, bringing respite to commercial users such as hotels, restaurants, and businesses. Meanwhile, the prices of domestic 14.2 kg LPG cylinders, widely used in households, have not been changed, according to a report by the news agency ANI.<h3>Updated LPG cylinder rates in major cities</h3>After the recent price cut of one unit of a commercial LPG cylinder in Delhi will now cost Rs 1,665, down from Rs 1,723.50, providing relief to commercial users.In Mumbai, the retail price of 19-kg LPG cylinders will now cost Rs 1,616 after a slashing from the previous rate costing Rs 1674.50 per cylinder.In addition, the commercial price of an LPG cylinder will cost Rs 1,769 in Kolkata and Rs 1,823.50 in Chennai, reducing from Rs 1,826 and Rs 1,881, respectively.<h3>Could crude oil prices drop globally?</h3>As per a June 27 research report by ICICI Bank, international crude oil prices may face downward pressure due to several contributing factors. These include the easing of tensions between Israel and Iran, weaker-than-expected global demand, and a rise in overall oil production.On the demand front, the report notes that prolonged trade-related uncertainties could continue to dampen consumption. It also projects that oil demand in 2025 will remain largely flat at 102.9 million barrels per day (mbpd), similar to the levels seen in 2024, amid slow global economic growth.Also read: India: <a href="https://www.wionews.com/india-news/india-price-of-commercial-lpg-gas-cylinders-reduced-by-rs-7-8680060">Price of commercial LPG gas cylinders reduced by Rs 7</a>In terms of supply, global crude production is showing an upward trend, driven primarily by increased output from OPEC countries, while supply from non-OPEC producers has also remained stable."The physical markets recorded a net supply surplus for the fifth consecutive month of 1.6mbpd in May compared to 1.9mbpd recorded in April," ICICI Bank said.However, the report also suggested that the effect of the Iran-Israel conflict on the spike in crude prices was much lower than previous geopolitical tensions, such as the Russia-Ukraine war.&nbsp;

After the recent price cut of one unit of a commercial LPG cylinder in Delhi will now cost Rs 1,665, down. In Mumbai, will cost Rs 1,616, Rs 1,769 in Kolkata and Rs 1,823.50 in Chennai.

The prices of commercial LPG gas cylinders were revised by the oil marketing companies on Tuesday (July 1, 2025), reducing the cost of a 19 kg commercial cylinder by Rs 58.50. The slash in the price will come into effect from July 1, 2025, bringing respite to commercial users such as hotels, restaurants, and businesses. Meanwhile, the prices of domestic 14.2 kg LPG cylinders, widely used in households, have not been changed, according to a report by the news agency ANI. Updated LPG cylinder rates in major cities After the recent price cut of one unit of a commercial LPG cylinder in Delhi will now cost Rs 1,665, down from Rs 1,723.50, providing relief to commercial users. In Mumbai, the retail price of 19-kg LPG cylinders will now cost Rs 1,616 after a slashing from the previous rate costing Rs 1674.50 per cylinder. In addition, the commercial price of an LPG cylinder will cost Rs 1,769 in Kolkata and Rs 1,823.50 in Chennai, reducing from Rs 1,826 and Rs 1,881, respectively. Could crude oil prices drop globally? As per a June 27 research report by ICICI Bank, international crude oil prices may face downward pressure due to several contributing factors. These include the easing of tensions between Israel and Iran, weaker-than-expected global demand, and a rise in overall oil production. On the demand front, the report notes that prolonged trade-related uncertainties could continue to dampen consumption. It also projects that oil demand in 2025 will remain largely flat at 102.9 million barrels per day (mbpd), similar to the levels seen in 2024, amid slow global economic growth. Also read: India: Price of commercial LPG gas cylinders reduced by Rs 7 In terms of supply, global crude production is showing an upward trend, driven primarily by increased output from OPEC countries, while supply from non-OPEC producers has also remained stable. "The physical markets recorded a net supply surplus for the fifth consecutive month of 1.6mbpd in May compared to 1.9mbpd recorded in April," ICICI Bank said. However, the report also suggested that the effect of the Iran-Israel conflict on the spike in crude prices was much lower than previous geopolitical tensions, such as the Russia-Ukraine war.

After the recent price cut of one unit of a commercial LPG cylinder in Delhi will now cost Rs 1,665, down. In Mumbai, will cost Rs 1,616, Rs 1,769 in Kolkata and Rs 1,823.50 in Chennai.

LPG price cut: Commercial 19-kg cylinder reduced by Rs 58.50—check latest rates city-wise

Oil prices steadied on Friday after a turbulent week that saw their sharpest weekly decline in nearly two years, as fears of supply disruption from the Israel–Iran conflict eased and traders eyed potential changes in OPEC+ output policy.&nbsp;Brent crude futures climbed above $68 a barrel in early trade, while US West Texas Intermediate (WTI) crude hovered around $65.80. Despite the modest rebound, both contracts were on track to post weekly losses of roughly 12 per cent, their steepest drop since 2023.<h2>Ceasefire between Israel and Iran cools market fears</h2>The steep sell-off this week was driven by geopolitical developments that removed the war risk premium almost overnight. The crisis escalated over the weekend when the US attacked Iranian nuclear sites, sending prices to a five-month high on Monday. However, markets reversed sharply after US President Donald Trump brokered a ceasefire between Israel and Iran on Tuesday, as per Reuters.&nbsp;With hostilities pausing, traders and analysts said they could see no material impact on oil flows in the short term, ending immediate fears of a broader regional disruption that had supported prices earlier in the week.<h2>OPEC+ output plans in focus</h2>Prices were also weighed down by a report suggesting the OPEC+ group of producers is considering a supply increase in August. According to the Wall Street Journal, discussions within the alliance point to a potential move to lift output quotas to meet expected summer demand and stabilise markets after recent volatility.&nbsp;Such a move would mark a cautious shift in policy, with OPEC+ balancing the need to keep prices from overheating with concerns about losing market share to non-member producers.<h2>Rate-cut bets add a floor to prices</h2>Despite the week’s sharp losses, some support for oil came from renewed bets on US interest rate cuts. &nbsp;As per the Wall Street Journal, President Trump is reportedly planning to name a successor to Federal Reserve Chair Jerome Powell earlier than expected. That move, seen as a bid to push for aggressive rate cuts, fuelled expectations that lower borrowing costs could stimulate US economic activity and boost oil demand.&nbsp;While the Fed has so far kept its benchmark rate at 4.25–4.50 per cent, markets are watching closely for any signal of a policy shift that could revive global growth prospects and energy consumption.<h2>Markets await clarity on supply and demand outlook</h2>With oil benchmarks now back at levels seen before the Israel–Iran conflict began, traders are bracing for further clarity on OPEC+ production plans and the macroeconomic outlook. The abrupt swing from war fears to ceasefire calm, combined with central bank policy uncertainty, underscores the fragile balance in oil markets.&nbsp;For now, the ceasefire has defused a key geopolitical risk, but the coming weeks could test whether lower prices prompt fresh diplomatic tension within OPEC+ over production strategy or whether demand fears persist amid slowing global growth.&nbsp;(With inputs from the agencies)

Oil benchmarks drop nearly 12% for the week, the steepest fall in almost two years, as a surprise ceasefire between Israel and Iran eases supply fears, while traders weigh potential OPEC+ output increases and US rate-cut expectations.

Oil prices steadied on Friday after a turbulent week that saw their sharpest weekly decline in nearly two years, as fears of supply disruption from the Israel–Iran conflict eased and traders eyed potential changes in OPEC+ output policy. Brent crude futures climbed above $68 a barrel in early trade, while US West Texas Intermediate (WTI) crude hovered around $65.80. Despite the modest rebound, both contracts were on track to post weekly losses of roughly 12 per cent, their steepest drop since 2023. Ceasefire between Israel and Iran cools market fears The steep sell-off this week was driven by geopolitical developments that removed the war risk premium almost overnight. The crisis escalated over the weekend when the US attacked Iranian nuclear sites, sending prices to a five-month high on Monday. However, markets reversed sharply after US President Donald Trump brokered a ceasefire between Israel and Iran on Tuesday, as per Reuters. With hostilities pausing, traders and analysts said they could see no material impact on oil flows in the short term, ending immediate fears of a broader regional disruption that had supported prices earlier in the week. OPEC+ output plans in focus Prices were also weighed down by a report suggesting the OPEC+ group of producers is considering a supply increase in August. According to the Wall Street Journal, discussions within the alliance point to a potential move to lift output quotas to meet expected summer demand and stabilise markets after recent volatility. Such a move would mark a cautious shift in policy, with OPEC+ balancing the need to keep prices from overheating with concerns about losing market share to non-member producers. Rate-cut bets add a floor to prices Despite the week’s sharp losses, some support for oil came from renewed bets on US interest rate cuts. As per the Wall Street Journal, President Trump is reportedly planning to name a successor to Federal Reserve Chair Jerome Powell earlier than expected. That move, seen as a bid to push for aggressive rate cuts, fuelled expectations that lower borrowing costs could stimulate US economic activity and boost oil demand. While the Fed has so far kept its benchmark rate at 4.25–4.50 per cent, markets are watching closely for any signal of a policy shift that could revive global growth prospects and energy consumption. Markets await clarity on supply and demand outlook With oil benchmarks now back at levels seen before the Israel–Iran conflict began, traders are bracing for further clarity on OPEC+ production plans and the macroeconomic outlook. The abrupt swing from war fears to ceasefire calm, combined with central bank policy uncertainty, underscores the fragile balance in oil markets. For now, the ceasefire has defused a key geopolitical risk, but the coming weeks could test whether lower prices prompt fresh diplomatic tension within OPEC+ over production strategy or whether demand fears persist amid slowing global growth. (With inputs from the agencies)

Oil prices steadied after a volatile week, as easing Israel–Iran tensions and speculation over OPEC+ supply shifts drove the sharpest weekly decline since 2023.

Oil prices steady after Israel–Iran ceasefire and OPEC+ supply rumours

Oil prices are heading for their worst weekly decline since March 2023, with traders stripping out any risk premium built up over fears of a wider Israel–Iran conflict in West Asia. Despite last week’s dramatic escalation, markets see no significant supply disruption as a ceasefire holds, pushing benchmark crude prices back to pre-conflict levels.<h2>War premium fades as ceasefire holds</h2>As per Reuters, Brent crude futures rose 35 cents, or 0.52 per cent, to US$68.08 a barrel in early trade on Friday, while US West Texas Intermediate (WTI) gained 40 cents, or 0.61 per cent, to US$65.64. Yet both benchmarks remain on track for a weekly fall of about 12 per cent—their steepest drop in more than two years. Prices had jumped to five-month highs earlier this week after US strikes targeted Iranian nuclear facilities over the weekend, fuelling fears of an all-out war that could threaten West Asian oil exports.&nbsp;&nbsp;But those gains quickly evaporated after US President Donald Trump announced a ceasefire deal on Tuesday, easing fears of a supply shock. As per Reuters, traders swiftly priced out the geopolitical risk that had driven the rally.<h2>Analysts see oversupply despite conflict</h2>According to Reuters, analysts note that while tensions remain, there is no visible impact on physical oil supply so far. Macquarie analysts wrote in a note on Thursday: “Absent the threat of significant supply disruption, we still view oil as fundamentally oversupplied, with our 2025 balances indicating a roughly 2.1 million barrels per day surplus.”&nbsp;Macquarie has slightly raised its WTI price forecast by US$2 to account for a modest ongoing geopolitical risk premium. But the broader outlook remains bearish, with global supplies seen as ample and OPEC+ still holding spare production capacity.<h2>US inventory draw offers limited support</h2>Even as the war premium vanished, oil prices found some support midweek from signs of tightening US stockpiles. As per Reuters, US government data showed crude oil and fuel inventories declined in the most recent reporting week, reflecting higher refinery utilisation and demand. Phil Flynn, senior analyst at the Price Futures Group, told Reuters the market was “starting to digest the fact that crude oil inventories are very tight all of a sudden.” Despite that, the bullish impulse proved limited, with the broader market narrative dominated by relief that West Asian energy infrastructure remained unharmed.&nbsp;Beyond the ceasefire in West Asia, traders are also watching US monetary policy for clues about demand. As reported by the Wall Street Journal, President Trump may announce his choice for the next Federal Reserve chair earlier than usual—a move that has fuelled market bets on possible interest rate cuts. Lower US rates could typically stimulate economic activity and energy demand, offering a potential tailwind for oil prices.&nbsp;&nbsp;But for now, the dominant factor this week has been the unwinding of war-driven price gains, as traders conclude the Israel–Iran ceasefire has largely defused the immediate threat of major supply disruptions.&nbsp;(With inputs from the agencies)&nbsp;

Brent crude rose slightly to $68.08, while WTI reached $65.64, but both are on track for a 12% drop. Analysts indicate an oversupply persists despite geopolitical tensions, and US inventory draws provided limited support. 

Oil prices are heading for their worst weekly decline since March 2023, with traders stripping out any risk premium built up over fears of a wider Israel–Iran conflict in West Asia. Despite last week’s dramatic escalation, markets see no significant supply disruption as a ceasefire holds, pushing benchmark crude prices back to pre-conflict levels. War premium fades as ceasefire holds As per Reuters, Brent crude futures rose 35 cents, or 0.52 per cent, to US$68.08 a barrel in early trade on Friday, while US West Texas Intermediate (WTI) gained 40 cents, or 0.61 per cent, to US$65.64. Yet both benchmarks remain on track for a weekly fall of about 12 per cent—their steepest drop in more than two years. Prices had jumped to five-month highs earlier this week after US strikes targeted Iranian nuclear facilities over the weekend, fuelling fears of an all-out war that could threaten West Asian oil exports. But those gains quickly evaporated after US President Donald Trump announced a ceasefire deal on Tuesday, easing fears of a supply shock. As per Reuters, traders swiftly priced out the geopolitical risk that had driven the rally. Analysts see oversupply despite conflict According to Reuters, analysts note that while tensions remain, there is no visible impact on physical oil supply so far. Macquarie analysts wrote in a note on Thursday: “Absent the threat of significant supply disruption, we still view oil as fundamentally oversupplied, with our 2025 balances indicating a roughly 2.1 million barrels per day surplus.” Macquarie has slightly raised its WTI price forecast by US$2 to account for a modest ongoing geopolitical risk premium. But the broader outlook remains bearish, with global supplies seen as ample and OPEC+ still holding spare production capacity. US inventory draw offers limited support Even as the war premium vanished, oil prices found some support midweek from signs of tightening US stockpiles. As per Reuters, US government data showed crude oil and fuel inventories declined in the most recent reporting week, reflecting higher refinery utilisation and demand. Phil Flynn, senior analyst at the Price Futures Group, told Reuters the market was “starting to digest the fact that crude oil inventories are very tight all of a sudden.” Despite that, the bullish impulse proved limited, with the broader market narrative dominated by relief that West Asian energy infrastructure remained unharmed. Beyond the ceasefire in West Asia, traders are also watching US monetary policy for clues about demand. As reported by the Wall Street Journal, President Trump may announce his choice for the next Federal Reserve chair earlier than usual—a move that has fuelled market bets on possible interest rate cuts. Lower US rates could typically stimulate economic activity and energy demand, offering a potential tailwind for oil prices. But for now, the dominant factor this week has been the unwinding of war-driven price gains, as traders conclude the Israel–Iran ceasefire has largely defused the immediate threat of major supply disruptions. (With inputs from the agencies)

Oil prices face their steepest weekly decline since March 2023, dropping due to reduced risk premiums as a ceasefire holds between Israel and Iran.

Oil prices face steepest weekly fall in two years as West Asia war premium fades

Oil prices ticked up on Thursday after data showed a sharper-than-expected drop in US crude and gasoline inventories, underscoring strong fuel demand across the world’s largest economy. However, investor caution continues to cloud the market amid geopolitical uncertainty in West Asia and ambiguity surrounding future OPEC+ production policy, as per Reuters.<h2>US demand supports recovery</h2>Brent crude futures rose 12 cents to $67.80 per barrel in early Asian trade, while US West Texas Intermediate (WTI) gained 20 cents to reach $65.12. Both benchmarks had jumped nearly one per cent on Wednesday following signs of resilient demand from US consumers, as quoted by Reuters.Government data released by the Energy Information Administration (EIA) showed a significant drop of 5.8 million barrels in US crude inventories for the week ending June 20, well above analyst forecasts of a mere 797,000-barrel draw, according to Reuters.&nbsp;Gasoline inventories also fell sharply by 2.1 million barrels against expectations of a 381,000-barrel build. This coincided with a surge in fuel consumption, with gasoline supplied often used as a proxy for demand hitting its highest level since December 2021, as per EIA data cited by Reuters.“Some buyers are favouring solid demand indicated by falling inventories in US weekly statistics,” said Yuki Takashima, economist at Nomura Securities, as quoted by Reuters. He added that despite this bullish trend, “investors remain nervous, seeking clarity on the status of the Iran-Israel ceasefire”.<h2>Geopolitical jitters and OPEC+ decisions</h2>While tensions between Iran and Israel have eased following a US-brokered ceasefire, investors are watching closely for long-term diplomatic commitments. US President Donald Trump, in remarks on Wednesday, praised the cessation of hostilities but made it clear that Washington’s ‘maximum pressure’ campaign on Tehran, including oil sanctions remains in place, as per Reuters.&nbsp;However, Trump signalled a potential softening of enforcement, stating the US might allow limited leeway in oil transactions to help Iran “rebuild” its economy, provided talks on curbing its nuclear programme make progress, according to Reuters reporting.&nbsp;Market attention is also pivoting to production policy from the OPEC+ alliance. On Saturday, Rosneft CEO Igor Sechin suggested that the group, comprising the Organisation of the Petroleum Exporting Countries and allies like Russia could advance its planned production hikes by almost a year, as quoted by Reuters.Such a move could inject fresh supply into the market, potentially capping oil price gains just as seasonal summer demand strengthens.<h2>What's next?&nbsp;</h2>Analysts are split on where oil prices go next. Takashima of Nomura forecasts that WTI could stabilise back in the $60–$65 per barrel range, levels seen before the West Asia flare-up, as per Reuters.&nbsp;While physical demand remains strong, traders are closely monitoring upcoming US-Iran talks, any shifts in OPEC+ output strategy, and broader macroeconomic signals from top consumers like China and India.With West Asia still fragile and major producers walking a tightrope between market share and price stability, oil markets remain delicately balanced.&nbsp;(With inputs from the agencies)&nbsp;

Despite a bullish demand signal from the US, oil markets face volatility as traders weigh fragile West Asia peace and potential OPEC+ supply shifts.

Oil prices ticked up on Thursday after data showed a sharper-than-expected drop in US crude and gasoline inventories, underscoring strong fuel demand across the world’s largest economy. However, investor caution continues to cloud the market amid geopolitical uncertainty in West Asia and ambiguity surrounding future OPEC+ production policy, as per Reuters. US demand supports recovery Brent crude futures rose 12 cents to $67.80 per barrel in early Asian trade, while US West Texas Intermediate (WTI) gained 20 cents to reach $65.12. Both benchmarks had jumped nearly one per cent on Wednesday following signs of resilient demand from US consumers, as quoted by Reuters. Government data released by the Energy Information Administration (EIA) showed a significant drop of 5.8 million barrels in US crude inventories for the week ending June 20, well above analyst forecasts of a mere 797,000-barrel draw, according to Reuters. Gasoline inventories also fell sharply by 2.1 million barrels against expectations of a 381,000-barrel build. This coincided with a surge in fuel consumption, with gasoline supplied often used as a proxy for demand hitting its highest level since December 2021, as per EIA data cited by Reuters. “Some buyers are favouring solid demand indicated by falling inventories in US weekly statistics,” said Yuki Takashima, economist at Nomura Securities, as quoted by Reuters. He added that despite this bullish trend, “investors remain nervous, seeking clarity on the status of the Iran-Israel ceasefire”. Geopolitical jitters and OPEC+ decisions While tensions between Iran and Israel have eased following a US-brokered ceasefire, investors are watching closely for long-term diplomatic commitments. US President Donald Trump, in remarks on Wednesday, praised the cessation of hostilities but made it clear that Washington’s ‘maximum pressure’ campaign on Tehran, including oil sanctions remains in place, as per Reuters. However, Trump signalled a potential softening of enforcement, stating the US might allow limited leeway in oil transactions to help Iran “rebuild” its economy, provided talks on curbing its nuclear programme make progress, according to Reuters reporting. Market attention is also pivoting to production policy from the OPEC+ alliance. On Saturday, Rosneft CEO Igor Sechin suggested that the group, comprising the Organisation of the Petroleum Exporting Countries and allies like Russia could advance its planned production hikes by almost a year, as quoted by Reuters. Such a move could inject fresh supply into the market, potentially capping oil price gains just as seasonal summer demand strengthens. What's next? Analysts are split on where oil prices go next. Takashima of Nomura forecasts that WTI could stabilise back in the $60–$65 per barrel range, levels seen before the West Asia flare-up, as per Reuters. While physical demand remains strong, traders are closely monitoring upcoming US-Iran talks, any shifts in OPEC+ output strategy, and broader macroeconomic signals from top consumers like China and India. With West Asia still fragile and major producers walking a tightrope between market share and price stability, oil markets remain delicately balanced. (With inputs from the agencies)

Oil prices rise on strong US demand and inventory draw, but West Asia tensions and OPEC+ policy keep markets on edge.

Oil prices rise as US crude draw points to firm demand; West Asia risks still linger

Oil prices inched higher on June 25 after two days of sharp declines, as markets assessed the durability of a ceasefire between Iran and Israel and the broader implications for global crude supply. Brent crude futures rose by 75 cents, or 1.1 per cent, to $67.89 a barrel, while US West Texas Intermediate (WTI) crude gained 71 cents, or 1.1 per cent, to $65.08. The fragile truce between Iran and Israel, brokered by US President Donald Trump, brought a temporary pause to hostilities following nearly two weeks of conflict that had briefly spiked oil prices to five-month highs.&nbsp;The uptick follows a steep fall earlier in the week, when Brent settled at its lowest level since June 10 and WTI since June 5—dates that predated Israel’s surprise attack on Iran on June 13. Oil markets had surged briefly after the US joined the conflict with targeted strikes on three nuclear facilities in Iran over the weekend. However, investor fears of a wider supply disruption quickly eased after the announcement of a ceasefire.<h2>Oil outlook hangs on the thread of hope</h2>Though the US strikes were intended to curb Iran’s nuclear capabilities, a preliminary intelligence assessment suggested the facilities would only be set back by a few months. Still, both Tehran and Tel Aviv have since signalled a halt to direct air assaults, raising hopes for a period of calm.Despite this, tensions remain high in the region. Violations of the ceasefire have been reported, prompting the White House to issue renewed calls for restraint. Of particular concern to investors is the Strait of Hormuz—a narrow waterway between Iran and Oman through which nearly 20 per cent of global crude and fuel flows. Any disruption there could have major implications for global energy security.India, which relies on imports for over 85 per cent of its crude requirements—36 per cent of which passes through the Strait—welcomed the de-escalation. The Ministry of External Affairs called for diplomacy and dialogue, offering to support efforts to ensure lasting peace.Data from the American Petroleum Institute (API) on June 24 showed that US inventories shrank nearly 4.3 million barrels in the previous week (ended June 20), beating the expectations for a draw of 0.6 million barrels. Outsized draws in US inventories helped spur some confidence in fuel demand, which was seen picking up sharply with the summer season.This follows a 10.1 million barrel draw from the week before, pointing to quickly tightening US oil stockpiles. The API data usually heralds a similar trend from official inventory data, which is due later on today (June 25).

The fragile truce between Iran and Israel, brokered by US President Donald Trump, brought a temporary pause to hostilities following nearly two weeks of conflict that had briefly spiked oil prices to five-month highs.

Oil prices inched higher on June 25 after two days of sharp declines, as markets assessed the durability of a ceasefire between Iran and Israel and the broader implications for global crude supply. Brent crude futures rose by 75 cents, or 1.1 per cent, to $67.89 a barrel, while US West Texas Intermediate (WTI) crude gained 71 cents, or 1.1 per cent, to $65.08. The fragile truce between Iran and Israel, brokered by US President Donald Trump, brought a temporary pause to hostilities following nearly two weeks of conflict that had briefly spiked oil prices to five-month highs. The uptick follows a steep fall earlier in the week, when Brent settled at its lowest level since June 10 and WTI since June 5—dates that predated Israel’s surprise attack on Iran on June 13. Oil markets had surged briefly after the US joined the conflict with targeted strikes on three nuclear facilities in Iran over the weekend. However, investor fears of a wider supply disruption quickly eased after the announcement of a ceasefire. Oil outlook hangs on the thread of hope Though the US strikes were intended to curb Iran’s nuclear capabilities, a preliminary intelligence assessment suggested the facilities would only be set back by a few months. Still, both Tehran and Tel Aviv have since signalled a halt to direct air assaults, raising hopes for a period of calm. Despite this, tensions remain high in the region. Violations of the ceasefire have been reported, prompting the White House to issue renewed calls for restraint. Of particular concern to investors is the Strait of Hormuz—a narrow waterway between Iran and Oman through which nearly 20 per cent of global crude and fuel flows. Any disruption there could have major implications for global energy security. India, which relies on imports for over 85 per cent of its crude requirements—36 per cent of which passes through the Strait—welcomed the de-escalation. The Ministry of External Affairs called for diplomacy and dialogue, offering to support efforts to ensure lasting peace. Data from the American Petroleum Institute (API) on June 24 showed that US inventories shrank nearly 4.3 million barrels in the previous week (ended June 20), beating the expectations for a draw of 0.6 million barrels. Outsized draws in US inventories helped spur some confidence in fuel demand, which was seen picking up sharply with the summer season. This follows a 10.1 million barrel draw from the week before, pointing to quickly tightening US oil stockpiles. The API data usually heralds a similar trend from official inventory data, which is due later on today (June 25).

The fragile truce between Iran and Israel, brokered by US President Donald Trump, brought a temporary pause to hostilities following nearly two weeks of conflict that had briefly spiked oil prices to five-month highs.

Oil prices rebound slightly as markets eye fragile Iran-Israel ceasefire

Oil prices plunged to over one-week lows on Tuesday after US President Donald Trump declared that Iran and Israel had agreed to a ceasefire, easing fears of prolonged conflict and potential disruptions to oil supplies in the West Asia. As per Reuters, Brent crude futures dropped $2.69, or 3.76 per cent, to $68.79 a barrel as of 0006 GMT. Earlier in the session, prices fell more than 4 per cent to their lowest since June 11.&nbsp;&nbsp;Meanwhile, US West Texas Intermediate (WTI) crude fell $2.70, or 3.94 per cent, to $65.46 per barrel—its weakest since June 9—after sliding nearly 6 per cent earlier in the day.<h2>Trump confirms ceasefire timeline</h2>President Trump announced on Monday that both sides had reached a “complete and total” ceasefire. As quoted by Reuters, Iran is to begin the ceasefire immediately, with Israel following after 12 hours. If peace holds, the war, now 12 days old, will officially end within 24 hours.&nbsp;The truce comes days after the US carried out strikes on Iranian nuclear facilities, a move that had pushed oil prices to five-month highs and triggered fears of broader regional escalation.<h2>Oil market sheds war premium</h2>Tony Sycamore, market analyst at IG, told Reuters, “The risk premium built into crude oil last week has all but evaporated.” Traders appear to be unwinding positions that had been built up on the expectation of wider conflict and potential supply shocks.&nbsp;Iran is OPEC’s third-largest crude oil producer, and an easing of hostilities is expected to facilitate the resumption of its oil exports. This is a key factor behind the pullback in oil prices, which had surged in recent sessions on fears of supply disruptions.<h2>Resistance levels cap recovery</h2>Despite the decline, analysts say oil prices may still face strong technical resistance. Sycamore added that the recent sell-off reinforces a price ceiling between $78.40, marking the highs of October 2024 and June 2025 and $80.77, the current year-to-date high.&nbsp;According to Reuters, both Brent and WTI benchmarks had rallied more than 7 per cent in the previous session before reversing gains following Trump’s ceasefire announcement. As markets digest the truce, attention now turns to its implementation and durability. A stable ceasefire could allow Iranian oil to flow more freely, bringing relief to importers and potentially easing inflationary pressures globally.&nbsp;(With inputs from the agencies) &nbsp;

Analysts noted that the war risk premium has largely dissipated, but technical resistance may limit further recovery as markets assess the ceasefire sustainability.

Oil prices plunged to over one-week lows on Tuesday after US President Donald Trump declared that Iran and Israel had agreed to a ceasefire, easing fears of prolonged conflict and potential disruptions to oil supplies in the West Asia. As per Reuters, Brent crude futures dropped $2.69, or 3.76 per cent, to $68.79 a barrel as of 0006 GMT. Earlier in the session, prices fell more than 4 per cent to their lowest since June 11. Meanwhile, US West Texas Intermediate (WTI) crude fell $2.70, or 3.94 per cent, to $65.46 per barrel—its weakest since June 9—after sliding nearly 6 per cent earlier in the day. Trump confirms ceasefire timeline President Trump announced on Monday that both sides had reached a “complete and total” ceasefire. As quoted by Reuters, Iran is to begin the ceasefire immediately, with Israel following after 12 hours. If peace holds, the war, now 12 days old, will officially end within 24 hours. The truce comes days after the US carried out strikes on Iranian nuclear facilities, a move that had pushed oil prices to five-month highs and triggered fears of broader regional escalation. Oil market sheds war premium Tony Sycamore, market analyst at IG, told Reuters, “The risk premium built into crude oil last week has all but evaporated.” Traders appear to be unwinding positions that had been built up on the expectation of wider conflict and potential supply shocks. Iran is OPEC’s third-largest crude oil producer, and an easing of hostilities is expected to facilitate the resumption of its oil exports. This is a key factor behind the pullback in oil prices, which had surged in recent sessions on fears of supply disruptions. Resistance levels cap recovery Despite the decline, analysts say oil prices may still face strong technical resistance. Sycamore added that the recent sell-off reinforces a price ceiling between $78.40, marking the highs of October 2024 and June 2025 and $80.77, the current year-to-date high. According to Reuters, both Brent and WTI benchmarks had rallied more than 7 per cent in the previous session before reversing gains following Trump’s ceasefire announcement. As markets digest the truce, attention now turns to its implementation and durability. A stable ceasefire could allow Iranian oil to flow more freely, bringing relief to importers and potentially easing inflationary pressures globally. (With inputs from the agencies)

Oil prices fell to over one-week lows after President Trump announced a ceasefire between Iran and Israel, easing conflict fears. Brent crude declined by 3.76% to $68.79 and WTI fell 3.94% to $65.46.

Oil prices drop to one-week low as Trump announces Israel–Iran ceasefire

Oil prices surged on June 23, marking their highest levels since January, as escalating tensions between the United States and Iran sparked fears of significant disruptions to global oil supply.&nbsp;The price of Brent crude futures rose by $1.92, or 2.49 per cent, to $78.93 per barrel, while US West Texas Intermediate (WTI) crude advanced by $1.89, or 2.56 per cent, to $75.73 per barrel. The surge followed airstrikes over the weekend by the US on three of Iran's main nuclear sites, raising alarm over the potential for retaliatory actions from Tehran.The military strikes, which targeted key facilities at Fordow, Natanz, and Isfahan, marked a significant escalation in the ongoing Iran-Israel conflict, with the US joining Israel in its offensive against Iran’s nuclear capabilities.&nbsp;As a result, oil traders responded to the uncertainty in West Asia by pushing prices to new highs, briefly touching $81.40 per barrel for Brent and $78.40 for WTI, before some of the gains were pared back.The primary concern for oil markets is the potential for Iran to retaliate by closing the Strait of Hormuz, a critical chokepoint through which about a fifth of the global oil supply passes. Iran’s parliament has already approved a measure to close the waterway, but the final decision rests with the country’s National Security Council.&nbsp;The closure of the strait could have a profound impact on global oil flows, leading to a sharp increase in prices. Analysts warned that if Iran takes such an action, it could drive Brent crude to $100 per barrel, exacerbating inflationary pressures worldwide.West Asia, home to one-third of global oil production, remains a major focal point for oil price volatility. With both Iran and Saudi Arabia among the world’s largest oil exporters, any escalation in hostilities could trigger significant disruptions to oil infrastructure in the region.&nbsp;Furthermore, the US response to any Iranian retaliation remains unclear, with Trump administration officials suggesting that further military action could be forthcoming should Iran strike back.Despite the recent price increases, analysts caution that oil markets are still vulnerable to the risk of supply disruptions and geopolitical developments.&nbsp;Goldman Sachs has warned that the geopolitical risk premium currently priced into oil futures may not last unless there is a tangible disruption to supply. If tensions ease and oil flows remain uninterrupted, prices could stabilise or even decline, as OPEC+ nations have ramped up production in recent months to meet global demand. However, with the situation in West Asia continuing to evolve, the outlook remains uncertain.<h2>Impact on global economy and energy markets</h2>The surging oil prices have raised concerns about the broader economic implications, especially for countries heavily reliant on oil imports. Nations like India, which imports a significant portion of its crude oil, are particularly vulnerable to rising prices.&nbsp;Analysts suggest that even a modest increase in oil prices could strain India’s economy by raising inflation and increasing the cost of essential goods, such as transportation and manufacturing inputs.The ongoing tensions between the US and Iran also have broader implications for global energy markets. In addition to the potential closure of the Strait of Hormuz, Iran may choose to target other oil infrastructure in the region, or even its export terminals, which could exacerbate the supply shock.&nbsp;However, it is also possible that the conflict could de-escalate, as has occurred in the past, and the global oil supply could return to normal, leading to a reduction in prices.Despite the uncertainties, oil markets have been on a steady upward trajectory since early June, with Brent crude prices climbing by 13 per cent since the conflict began. The volatility seen in recent weeks is expected to continue as traders monitor developments in West Asia closely.&nbsp;The meeting of OPEC+ members on July 5 will be a key event to watch, as decisions on further production increases may influence the market’s ability to manage supply and demand amidst growing geopolitical risks.As the situation unfolds, the oil market remains in flux, and both producers and consumers will be closely watching for signs of further escalation or potential de-escalation in the region.

Oil traders responded to the uncertainty in West Asia by pushing prices to new highs, briefly touching $81.40 per barrel for Brent and $78.40 for WTI, before some of the gains were pared back.

Oil prices surged on June 23, marking their highest levels since January, as escalating tensions between the United States and Iran sparked fears of significant disruptions to global oil supply. The price of Brent crude futures rose by $1.92, or 2.49 per cent, to $78.93 per barrel, while US West Texas Intermediate (WTI) crude advanced by $1.89, or 2.56 per cent, to $75.73 per barrel. The surge followed airstrikes over the weekend by the US on three of Iran's main nuclear sites, raising alarm over the potential for retaliatory actions from Tehran. The military strikes, which targeted key facilities at Fordow, Natanz, and Isfahan, marked a significant escalation in the ongoing Iran-Israel conflict, with the US joining Israel in its offensive against Iran’s nuclear capabilities. As a result, oil traders responded to the uncertainty in West Asia by pushing prices to new highs, briefly touching $81.40 per barrel for Brent and $78.40 for WTI, before some of the gains were pared back. The primary concern for oil markets is the potential for Iran to retaliate by closing the Strait of Hormuz, a critical chokepoint through which about a fifth of the global oil supply passes. Iran’s parliament has already approved a measure to close the waterway, but the final decision rests with the country’s National Security Council. The closure of the strait could have a profound impact on global oil flows, leading to a sharp increase in prices. Analysts warned that if Iran takes such an action, it could drive Brent crude to $100 per barrel, exacerbating inflationary pressures worldwide. West Asia, home to one-third of global oil production, remains a major focal point for oil price volatility. With both Iran and Saudi Arabia among the world’s largest oil exporters, any escalation in hostilities could trigger significant disruptions to oil infrastructure in the region. Furthermore, the US response to any Iranian retaliation remains unclear, with Trump administration officials suggesting that further military action could be forthcoming should Iran strike back. Despite the recent price increases, analysts caution that oil markets are still vulnerable to the risk of supply disruptions and geopolitical developments. Goldman Sachs has warned that the geopolitical risk premium currently priced into oil futures may not last unless there is a tangible disruption to supply. If tensions ease and oil flows remain uninterrupted, prices could stabilise or even decline, as OPEC+ nations have ramped up production in recent months to meet global demand. However, with the situation in West Asia continuing to evolve, the outlook remains uncertain. Impact on global economy and energy markets The surging oil prices have raised concerns about the broader economic implications, especially for countries heavily reliant on oil imports. Nations like India, which imports a significant portion of its crude oil, are particularly vulnerable to rising prices. Analysts suggest that even a modest increase in oil prices could strain India’s economy by raising inflation and increasing the cost of essential goods, such as transportation and manufacturing inputs. The ongoing tensions between the US and Iran also have broader implications for global energy markets. In addition to the potential closure of the Strait of Hormuz, Iran may choose to target other oil infrastructure in the region, or even its export terminals, which could exacerbate the supply shock. However, it is also possible that the conflict could de-escalate, as has occurred in the past, and the global oil supply could return to normal, leading to a reduction in prices. Despite the uncertainties, oil markets have been on a steady upward trajectory since early June, with Brent crude prices climbing by 13 per cent since the conflict began. The volatility seen in recent weeks is expected to continue as traders monitor developments in West Asia closely. The meeting of OPEC+ members on July 5 will be a key event to watch, as decisions on further production increases may influence the market’s ability to manage supply and demand amidst growing geopolitical risks. As the situation unfolds, the oil market remains in flux, and both producers and consumers will be closely watching for signs of further escalation or potential de-escalation in the region.

Oil traders responded to the uncertainty in West Asia by pushing prices to new highs, briefly touching $81.40 per barrel for Brent and $78.40 for WTI, before some of the gains were pared back.

Brent crude hits five-month high amid US-Iran tensions, risks of supply disruptions loom

On June 22, the United States launched airstrikes on Iran’s key nuclear facilities, marking another escalation in a tense, 10-day-long conflict involving Israel and Iran. The strikes, which targeted Iran’s uranium enrichment sites at Fordow, Natanz, and Esfahan, seem to have far-reaching consequences for global oil markets as the world witnesses a significant shift in the geopolitical landscape.The US attack follows days of mounting speculation about whether the Donald Trump-led administration would intervene in the conflict between Israel and Iran. While Israel had already been bombing Iranian sites for over a week, the US airstrikes have taken the conflict to a new level. Experts warn that this could disrupt not only the regional balance of power but also the global oil supply chain, as Iran is a key oil exporter in West Asia.For years, the Strait of Hormuz—a narrow waterway between Oman and Iran—has been a focal point of geopolitical tensions. This vital chokepoint facilitates the transit of about 20 per cent of the world’s crude oil, making any potential disruption here a major concern for oil-dependent economies worldwide.<h2>Oil prices surge as a direct consequence of the conflict</h2>Following the US strikes, oil prices have already begun to show signs of volatility, with Brent Crude futures surging by 11 per cent over the past week.&nbsp;On June 22, as the markets opened, prices were hovering around $80 per barrel, fuelled by the uncertainty surrounding the conflict and the potential for further disruption. Analysts believe this is just the beginning, with prices expected to rise even more if the conflict continues to intensify.A supply disruption, particularly a blockage of the Strait of Hormuz, would have catastrophic effects on global oil prices. Already, analysts warn that crude oil prices could rise by 15 per cent to 20 per cent if the conflict results in a daily loss of 1.1 million barrels in production.&nbsp;More severe disruptions could push Brent crude prices above $90 per barrel or even $100 per barrel if Iran retaliates by targeting oil infrastructure or closing off key shipping lanes.<h2>Global oil supply faces a murky situation</h2>The global oil market is already in a precarious position, with OPEC+ planning a production hike in July, increasing output by 4.11 million barrels per day. Despite this, analysts remain concerned that these measures may not be sufficient to cushion the shock of an escalation in the Gulf.&nbsp;Given that Iran is the third-largest member of OPEC+, the loss of its oil exports could exacerbate supply shortages, leading to even higher prices.Though some analysts believe that global supply can be stabilised through increased output from other OPEC members, the region’s fragile geopolitical situation makes this approach uncertain.&nbsp;Saudi Arabia, the UAE, and Kuwait, among others, also rely on the Strait of Hormuz for shipping their crude, and any serious disruption could lead to further instability in the region.<h2>India’s vulnerability as an oil-dependent economy at risk</h2>For India, the stakes are particularly high. The country relies heavily on oil imports from West Asia, with around 40 per cent of its oil and over 50 per cent of its LNG transiting through the Strait of Hormuz.&nbsp;If the waterway is blocked, India could face significant economic consequences, including soaring fuel prices and inflation.India consumes approximately 5.5 million barrels of oil per day, with 1.5 million barrels passing through the Strait. The potential disruption of this critical shipping lane could push oil prices much higher, further adding to inflationary pressures in the country.&nbsp;According to experts, any blockade of the Strait would likely push India’s crude oil costs higher, which in turn would affect the country’s GDP by around 0.5 per cent for every $10 increase in crude prices.The country’s oil marketing companies, such as HPCL, BPCL, and Indian Oil, would feel the brunt of this price spike, as would sectors like aviation, paint manufacturers, and tyre companies that rely on oil products. This could also lead to a potential slowdown in India’s economic growth, particularly in the face of rising inflation.To mitigate these risks, India’s Petroleum Minister, Hardeep Puri, has assured that the country is diversifying its crude oil sources. India plans to cut refined product exports and explore alternative suppliers if the Strait is blocked.&nbsp;Puri emphasised, “We have enough diversified supplies of crude, and even if there were to be a disruption, we can source it from alternative suppliers.”<h2>Iran’s threat to close the Strait: An existential move?</h2>One of the most significant threats arising from this conflict is Iran’s repeated warnings that it may close the Strait of Hormuz in retaliation for US and Israeli military actions. While Iran has made similar threats in the past, it has never followed through, as doing so would also harm its own oil exports.However, the current situation is different. With the US now directly involved in the conflict, the risk of an Iranian retaliation is higher than ever. Experts believe that if Iran does take such an extreme step, it could severely disrupt global oil flows, particularly for countries like India and China, which are major importers of Iranian oil.While closing the Strait would certainly hurt global oil supply, it could also backfire on Iran, as the country depends on this route for its own oil exports. China, Iran’s largest oil trading partner, is unlikely to stand by as its oil shipments are affected. China’s influence in this situation could pressure Iran to reconsider any drastic actions.<h2>Fragile peace or an all-out oil war?</h2>As the conflict between Israel and Iran escalates, oil markets remain on edge. If the situation devolves into an all-out confrontation, the consequences for the global economy could be severe.&nbsp;For now, experts suggest that the geopolitical risk premium on oil will remain high, and the global oil market will have to navigate a delicate balance between supply disruptions and geopolitical manoeuvring.As the situation develops, much will depend on how quickly Iran decides to retaliate, whether the US will escalate its involvement, and how OPEC+ members respond to the changing supply dynamics.

Experts warn that this could disrupt not only the regional balance of power but also the global oil supply chain, as Iran is a key oil exporter in West Asia.

On June 22, the United States launched airstrikes on Iran’s key nuclear facilities, marking another escalation in a tense, 10-day-long conflict involving Israel and Iran. The strikes, which targeted Iran’s uranium enrichment sites at Fordow, Natanz, and Esfahan, seem to have far-reaching consequences for global oil markets as the world witnesses a significant shift in the geopolitical landscape. The US attack follows days of mounting speculation about whether the Donald Trump-led administration would intervene in the conflict between Israel and Iran. While Israel had already been bombing Iranian sites for over a week, the US airstrikes have taken the conflict to a new level. Experts warn that this could disrupt not only the regional balance of power but also the global oil supply chain, as Iran is a key oil exporter in West Asia. For years, the Strait of Hormuz—a narrow waterway between Oman and Iran—has been a focal point of geopolitical tensions. This vital chokepoint facilitates the transit of about 20 per cent of the world’s crude oil, making any potential disruption here a major concern for oil-dependent economies worldwide. Oil prices surge as a direct consequence of the conflict Following the US strikes, oil prices have already begun to show signs of volatility, with Brent Crude futures surging by 11 per cent over the past week. On June 22, as the markets opened, prices were hovering around $80 per barrel, fuelled by the uncertainty surrounding the conflict and the potential for further disruption. Analysts believe this is just the beginning, with prices expected to rise even more if the conflict continues to intensify. A supply disruption, particularly a blockage of the Strait of Hormuz, would have catastrophic effects on global oil prices. Already, analysts warn that crude oil prices could rise by 15 per cent to 20 per cent if the conflict results in a daily loss of 1.1 million barrels in production. More severe disruptions could push Brent crude prices above $90 per barrel or even $100 per barrel if Iran retaliates by targeting oil infrastructure or closing off key shipping lanes. Global oil supply faces a murky situation The global oil market is already in a precarious position, with OPEC+ planning a production hike in July, increasing output by 4.11 million barrels per day. Despite this, analysts remain concerned that these measures may not be sufficient to cushion the shock of an escalation in the Gulf. Given that Iran is the third-largest member of OPEC+, the loss of its oil exports could exacerbate supply shortages, leading to even higher prices. Though some analysts believe that global supply can be stabilised through increased output from other OPEC members, the region’s fragile geopolitical situation makes this approach uncertain. Saudi Arabia, the UAE, and Kuwait, among others, also rely on the Strait of Hormuz for shipping their crude, and any serious disruption could lead to further instability in the region. India’s vulnerability as an oil-dependent economy at risk For India, the stakes are particularly high. The country relies heavily on oil imports from West Asia, with around 40 per cent of its oil and over 50 per cent of its LNG transiting through the Strait of Hormuz. If the waterway is blocked, India could face significant economic consequences, including soaring fuel prices and inflation. India consumes approximately 5.5 million barrels of oil per day, with 1.5 million barrels passing through the Strait. The potential disruption of this critical shipping lane could push oil prices much higher, further adding to inflationary pressures in the country. According to experts, any blockade of the Strait would likely push India’s crude oil costs higher, which in turn would affect the country’s GDP by around 0.5 per cent for every $10 increase in crude prices. The country’s oil marketing companies, such as HPCL, BPCL, and Indian Oil, would feel the brunt of this price spike, as would sectors like aviation, paint manufacturers, and tyre companies that rely on oil products. This could also lead to a potential slowdown in India’s economic growth, particularly in the face of rising inflation. To mitigate these risks, India’s Petroleum Minister, Hardeep Puri, has assured that the country is diversifying its crude oil sources. India plans to cut refined product exports and explore alternative suppliers if the Strait is blocked. Puri emphasised, “We have enough diversified supplies of crude, and even if there were to be a disruption, we can source it from alternative suppliers.” Iran’s threat to close the Strait: An existential move? One of the most significant threats arising from this conflict is Iran’s repeated warnings that it may close the Strait of Hormuz in retaliation for US and Israeli military actions. While Iran has made similar threats in the past, it has never followed through, as doing so would also harm its own oil exports. However, the current situation is different. With the US now directly involved in the conflict, the risk of an Iranian retaliation is higher than ever. Experts believe that if Iran does take such an extreme step, it could severely disrupt global oil flows, particularly for countries like India and China, which are major importers of Iranian oil. While closing the Strait would certainly hurt global oil supply, it could also backfire on Iran, as the country depends on this route for its own oil exports. China, Iran’s largest oil trading partner, is unlikely to stand by as its oil shipments are affected. China’s influence in this situation could pressure Iran to reconsider any drastic actions. Fragile peace or an all-out oil war? As the conflict between Israel and Iran escalates, oil markets remain on edge. If the situation devolves into an all-out confrontation, the consequences for the global economy could be severe. For now, experts suggest that the geopolitical risk premium on oil will remain high, and the global oil market will have to navigate a delicate balance between supply disruptions and geopolitical manoeuvring. As the situation develops, much will depend on how quickly Iran decides to retaliate, whether the US will escalate its involvement, and how OPEC+ members respond to the changing supply dynamics.

Experts warn that this could disrupt not only the regional balance of power but also the global oil supply chain, as Iran is a key oil exporter in West Asia.

US attacks Iranian nuclear sites: What lies ahead as geopolitical tensions rise

Rising tensions between Israel and Iran have put global investors on high alert, with growing fears that deeper United States involvement could spark a dramatic spike in oil prices and derail hopes of interest rate cuts.&nbsp;&nbsp;According to a detailed report by Reuters, markets are preparing for a range of outcomes, from inflation shocks to supply chain disruptions should the conflict escalate further.&nbsp;So far, oil has been the most affected asset class, while equities and bonds remain largely unmoved, but that calm may not last.<h2>Oil prices soar on supply disruption fears</h2>As per Reuters, Brent crude futures have surged as much as 18 per cent since 10 June, touching a five-month high of $79.04 per barrel on Thursday.&nbsp;&nbsp;US crude prices have also risen by around 10 per cent over the past week, driven by fears of potential strikes on Iranian oil infrastructure or the strategic Strait of Hormuz.&nbsp;Despite this, the S&amp;P 500 index has shown little overall movement, though analysts caution that markets are underestimating the potential fallout.&nbsp;&nbsp;“If you get disruption to supply of oil product on the global marketplace, that is not reflected in today’s WTI price and that is where things get negative,” Art Hogan, chief market strategist at B Riley Wealth, told Reuters.<h2>Oxford Economics models $130 oil risk</h2>According to Reuters, analysts at Oxford Economics have modelled three potential conflict scenarios, ranging from de-escalation to a complete halt in Iranian oil output, and the worst-case scenario: a closure of the Strait of Hormuz.&nbsp;In the most severe case, oil prices could surge to $130 per barrel, pushing US inflation to nearly 6 per cent by the end of 2025.&nbsp;&nbsp;“Although the price shock inevitably dampens consumer spending because of the hit to real incomes, the scale of the rise in inflation and concerns about second-round effects likely ruin any chance of rate cuts in the US this year,” Oxford Economics noted in a client memo, as quoted by Reuters.<h2>Market reacts&nbsp;</h2>Despite the oil price shock, equity markets have so far remained stable. Historical data cited by Reuters shows that in past Middle East conflicts — including the 2003 Iraq War and the 2019 attacks on Saudi oil facilities — the S&amp;P 500 typically dipped briefly before recovering.&nbsp;&nbsp;According to research from Wedbush Securities and CapIQ Pro, the index slipped 0.3 per cent in the first three weeks after such events but gained 2.3 per cent on average two months later.&nbsp;However, analysts caution that history may not be a reliable guide if the US military enters the conflict. “Geopolitical tensions have been mostly ignored by equities, but they are being factored into oil,” Citigroup analysts wrote in a note, as per Reuters.<h2>What about Dollar?&nbsp;</h2>The US dollar, which has already weakened in 2025 amid concerns over declining US exceptionalism And may initially benefit from&nbsp;safe-haven demand if fighting escalates.&nbsp;&nbsp;But longer-term, it could fall if Washington commits to a prolonged ground conflict, analysts say.&nbsp;“We recall that after the attacks of 9/11 and running through the decade-long US presence in Afghanistan and Iraq, the USD weakened,” Thierry Wizman, global FX and rates strategist at Macquarie Group, said in a note to clients, as reported by Reuters.<h2>Why it matters?</h2>The stakes for global markets are rising fast. A major supply shock in oil, particularly involving Iran could derail global disinflation trends, delay interest rate cuts, and hit household spending just as central banks hoped for a soft landing.&nbsp;&nbsp;While stock markets have shown resilience in past crises, this time the convergence of war, energy risk, and policy uncertainty may stretch investor optimism.&nbsp;&nbsp;As per Reuters, President Donald Trump is expected to make a decision on potential US military action in the next two weeks, a move that could determine whether the Middle East crisis becomes a full-blown economic shock.&nbsp;(With inputs from the agencies)&nbsp;

Brent crude jumps 18% as Israel–Iran tensions escalate; Oxford Economics warns of $130 oil and surging inflation if the Strait of Hormuz closes. Markets brace for Trump response amid rising economic risk.

Rising tensions between Israel and Iran have put global investors on high alert, with growing fears that deeper United States involvement could spark a dramatic spike in oil prices and derail hopes of interest rate cuts. According to a detailed report by Reuters, markets are preparing for a range of outcomes, from inflation shocks to supply chain disruptions should the conflict escalate further. So far, oil has been the most affected asset class, while equities and bonds remain largely unmoved, but that calm may not last. Oil prices soar on supply disruption fears As per Reuters, Brent crude futures have surged as much as 18 per cent since 10 June, touching a five-month high of $79.04 per barrel on Thursday. US crude prices have also risen by around 10 per cent over the past week, driven by fears of potential strikes on Iranian oil infrastructure or the strategic Strait of Hormuz. Despite this, the S&P 500 index has shown little overall movement, though analysts caution that markets are underestimating the potential fallout. “If you get disruption to supply of oil product on the global marketplace, that is not reflected in today’s WTI price and that is where things get negative,” Art Hogan, chief market strategist at B Riley Wealth, told Reuters. Oxford Economics models $130 oil risk According to Reuters, analysts at Oxford Economics have modelled three potential conflict scenarios, ranging from de-escalation to a complete halt in Iranian oil output, and the worst-case scenario: a closure of the Strait of Hormuz. In the most severe case, oil prices could surge to $130 per barrel, pushing US inflation to nearly 6 per cent by the end of 2025. “Although the price shock inevitably dampens consumer spending because of the hit to real incomes, the scale of the rise in inflation and concerns about second-round effects likely ruin any chance of rate cuts in the US this year,” Oxford Economics noted in a client memo, as quoted by Reuters. Market reacts Despite the oil price shock, equity markets have so far remained stable. Historical data cited by Reuters shows that in past Middle East conflicts — including the 2003 Iraq War and the 2019 attacks on Saudi oil facilities — the S&P 500 typically dipped briefly before recovering. According to research from Wedbush Securities and CapIQ Pro, the index slipped 0.3 per cent in the first three weeks after such events but gained 2.3 per cent on average two months later. However, analysts caution that history may not be a reliable guide if the US military enters the conflict. “Geopolitical tensions have been mostly ignored by equities, but they are being factored into oil,” Citigroup analysts wrote in a note, as per Reuters. What about Dollar? The US dollar, which has already weakened in 2025 amid concerns over declining US exceptionalism And may initially benefit from safe-haven demand if fighting escalates. But longer-term, it could fall if Washington commits to a prolonged ground conflict, analysts say. “We recall that after the attacks of 9/11 and running through the decade-long US presence in Afghanistan and Iraq, the USD weakened,” Thierry Wizman, global FX and rates strategist at Macquarie Group, said in a note to clients, as reported by Reuters. Why it matters? The stakes for global markets are rising fast. A major supply shock in oil, particularly involving Iran could derail global disinflation trends, delay interest rate cuts, and hit household spending just as central banks hoped for a soft landing. While stock markets have shown resilience in past crises, this time the convergence of war, energy risk, and policy uncertainty may stretch investor optimism. As per Reuters, President Donald Trump is expected to make a decision on potential US military action in the next two weeks, a move that could determine whether the Middle East crisis becomes a full-blown economic shock. (With inputs from the agencies)

Rising Israel–Iran tensions and fears of US involvement are fuelling oil price spikes and threatening to derail global rate-cut hopes, per Reuters.

Middle East tensions rattle oil markets as investors brace for worst-case US involvement

India’s Chief Economic Adviser, V. Anantha Nageswaran has said that the country is well-positioned to absorb the recent spike in global crude oil prices without experiencing a significant rise in inflation.&nbsp;&nbsp;In an interview published on Friday, Nageswaran told Bloomberg that India’s economic fundamentals remain strong, and that the oil-driven price surge though a concern does not yet warrant alarm.&nbsp;His comments come as Brent crude prices jumped nearly 20 per cent in the past month, driven by fears of a wider regional conflict following renewed hostilities between Israel and Iran.<h2>Oil prices rise but impact seen as limited</h2>According to Bloomberg, Nageswaran acknowledged that the rise in oil prices is linked to escalating tensions in the Middle East, but said the impact on domestic inflation would remain limited for now. “It is still not something that is going to be significant in terms of impact,” he said.&nbsp;India is the world’s third-largest importer of crude oil, making it highly vulnerable to global energy price shocks.&nbsp;&nbsp;Costlier crude can push up inflation, squeeze household budgets, and threaten the consumption-driven recovery in a country where private spending contributes around 60 per cent of GDP.&nbsp;However, Nageswaran noted that domestic factors such as cooling inflation, sufficient liquidity, and stable interest rates will act as cushions against global headwinds.<h2>Government not pressing the panic button</h2>Nageswaran also emphasised that the situation does not yet call for emergency economic measures. “It is too soon to get overly concerned yet,” he said, adding that any inflationary effect would depend on the duration of high oil prices. “It might have to take more than a quarter or even getting into a couple of quarters before we really have to worry,” he told Bloomberg.&nbsp;India’s retail inflation eased to an 11-month low of 4.75 per cent in May, comfortably within the Reserve Bank of India’s 2–6 per cent target range.&nbsp;&nbsp;Economists suggest that unless oil prices cross $100 per barrel and remain elevated for a prolonged period, the broader inflation outlook may not be significantly affected.<h2>Growth outlook remains intact</h2>The government expects India’s GDP to grow between 6.3 and 6.8 per cent in the current fiscal year ending March 2026. While this is slower than the 8 per cent average seen over the past two years, India is still projected to remain the fastest-growing major economy.&nbsp;Nageswaran said other positive factors, including a favourable monsoon, are expected to boost rural demand and agricultural output. “The underlying price pressures are quite absent, and ample rainfall will also aid India’s economy,” he said, as quoted by Bloomberg.<h2>Why it matters?</h2>India’s ability to withstand external shocks such as oil price volatility is critical at a time when many emerging economies are struggling with inflationary pressures, weak growth, and tight global financial conditions.&nbsp;&nbsp;A muted inflation fallout could give policymakers more space to focus on investment-led growth and infrastructure spending in the run-up to the 2026 Union Budget.&nbsp;Moreover, India’s stable inflation outlook may allow the Reserve Bank of India to hold interest rates steady for longer, avoiding the disruptions seen in other oil-importing nations.&nbsp;&nbsp;As global energy markets remain on edge due to geopolitical uncertainty, India’s cautious optimism as voiced by its top economic adviser sends a reassuring signal to investors.&nbsp;&nbsp;(With inputs from the agencies) &nbsp;

Despite surging crude prices amid Middle East tensions, India remains resilient on inflation, with CEA Nageswaran highlighting stable fundamentals and policy space for growth.

India’s Chief Economic Adviser, V. Anantha Nageswaran has said that the country is well-positioned to absorb the recent spike in global crude oil prices without experiencing a significant rise in inflation. In an interview published on Friday, Nageswaran told Bloomberg that India’s economic fundamentals remain strong, and that the oil-driven price surge though a concern does not yet warrant alarm. His comments come as Brent crude prices jumped nearly 20 per cent in the past month, driven by fears of a wider regional conflict following renewed hostilities between Israel and Iran. Oil prices rise but impact seen as limited According to Bloomberg, Nageswaran acknowledged that the rise in oil prices is linked to escalating tensions in the Middle East, but said the impact on domestic inflation would remain limited for now. “It is still not something that is going to be significant in terms of impact,” he said. India is the world’s third-largest importer of crude oil, making it highly vulnerable to global energy price shocks. Costlier crude can push up inflation, squeeze household budgets, and threaten the consumption-driven recovery in a country where private spending contributes around 60 per cent of GDP. However, Nageswaran noted that domestic factors such as cooling inflation, sufficient liquidity, and stable interest rates will act as cushions against global headwinds. Government not pressing the panic button Nageswaran also emphasised that the situation does not yet call for emergency economic measures. “It is too soon to get overly concerned yet,” he said, adding that any inflationary effect would depend on the duration of high oil prices. “It might have to take more than a quarter or even getting into a couple of quarters before we really have to worry,” he told Bloomberg. India’s retail inflation eased to an 11-month low of 4.75 per cent in May, comfortably within the Reserve Bank of India’s 2–6 per cent target range. Economists suggest that unless oil prices cross $100 per barrel and remain elevated for a prolonged period, the broader inflation outlook may not be significantly affected. Growth outlook remains intact The government expects India’s GDP to grow between 6.3 and 6.8 per cent in the current fiscal year ending March 2026. While this is slower than the 8 per cent average seen over the past two years, India is still projected to remain the fastest-growing major economy. Nageswaran said other positive factors, including a favourable monsoon, are expected to boost rural demand and agricultural output. “The underlying price pressures are quite absent, and ample rainfall will also aid India’s economy,” he said, as quoted by Bloomberg. Why it matters? India’s ability to withstand external shocks such as oil price volatility is critical at a time when many emerging economies are struggling with inflationary pressures, weak growth, and tight global financial conditions. A muted inflation fallout could give policymakers more space to focus on investment-led growth and infrastructure spending in the run-up to the 2026 Union Budget. Moreover, India’s stable inflation outlook may allow the Reserve Bank of India to hold interest rates steady for longer, avoiding the disruptions seen in other oil-importing nations. As global energy markets remain on edge due to geopolitical uncertainty, India’s cautious optimism as voiced by its top economic adviser sends a reassuring signal to investors. (With inputs from the agencies)

India's Chief Economic Adviser says rising oil prices won't significantly impact inflation, citing strong domestic fundamentals and stable growth outlook.

India won’t face major inflation shock from oil surge, says top government adviser

As the Israel–Iran conflict reignites fears of a wider Middle East war, its aftershocks are already rippling through global energy markets.&nbsp;&nbsp;For US oil producers, this moment has become a strategic opportunity. With crude prices surging, they are rushing to hedge against future volatility, triggering record volumes of oil price hedging trades.<h2>Oil prices spike after Israel’s surprise strike on Iran</h2>On June 13, oil prices recorded their sharpest single day jump since July 2022. West Texas Intermediate (WTI) crude futures surged 7 per cent to around $73 per barrel, after Israel carried out a surprise strike on Iran, reigniting geopolitical tensions in the Middle East.&nbsp;The rally continued into the following week, with WTI closing Friday near $75 per barrel.&nbsp;According to Reuters, this sudden uptick gave US producers a rare window to lock in prices above budget for the first time in months.<h2>Record hedging volumes on Aegis platform</h2>The surge in prices led to a rush of hedging activity.&nbsp;&nbsp;Aegis Hedging, which manages hedging for about 25–30 per cent of total US oil output, reported record volume and the largest number of trades ever executed on its platform on June 13, as per Reuters.&nbsp;US oil production currently stands at around 13.56 million barrels per day, based on the latest government data.&nbsp;&nbsp;As per Aegis, the June 13 price spike, driven more by geopolitical risk than traditional supply-demand factors created a six-month hedging opportunity window.&nbsp;Hedging reportedly allows producers to lock in future oil prices and shield themselves from market volatility, a crucial move when global prices are affected by sudden conflict-driven moves rather than fundamental trends.<h2>From four-year lows to sudden opportunity</h2>Just weeks earlier, producers were grappling with unviable price levels. In May, crude had dropped to a four-year low of $57 per barrel, amid an output hike by OPEC+ and ongoing global trade friction.&nbsp;&nbsp;US crude futures remained below $65 per barrel, the average profitable drilling threshold, for over two months, from April 4 to June 9, according to LSEG and the Dallas Federal Reserve’s Q1 2025 survey cited by Reuters.&nbsp;&nbsp;That changed overnight on June 13.&nbsp;“Producers recognised that this could be a fleeting issue,” said Matt Marshall, President of Aegis Hedging, as quoted by Reuters. “Instead of choosing conservative options with low-price floors, many opted to aggressively lock in high prices.”<h2>Permian Basin players and lending pressure</h2>For companies like Black Mountain Energy, operating in the Permian Basin, the strategy is more than opportunistic, it’s also financial.&nbsp;“We watch for accretive pricing to our existing hedges and layer in new ones to reduce risk and meet our reserve-based lending covenants,” Rhett Bennett, CEO of Black Mountain Energy told Reuters.&nbsp;Such covenants are tied to the value of a company’s oil and gas reserves and influence the credit available from lenders. Securing high-price hedges helps maintain favourable loan terms.<h2>Options market echoes bullish sentiment</h2>Not just producers, traders, too, jumped on the bandwagon. On the same day, June 13, a surge in options trading reflected market bets on further price increases, as per Reuters.&nbsp;&nbsp;A total of 33,411 call options for $80 WTI crude expiring in August 2025 were exchanged on the Chicago Mercantile Exchange, the highest volume of these contracts this year, according to CME Group data.&nbsp;Overall, trading volumes touched 681,000 contracts that day, highlighting how risk events in geopolitics are now reshaping expectations in the energy derivatives market.<h2>What next?</h2>The Israel–Iran conflict has reintroduced a geopolitical risk premium into oil prices. While producers capitalise on the current price surge, volatility remains a constant threat.&nbsp;&nbsp;As tensions in the Middle East persist and the US heads into election season with President Trump doubling down on energy independence, the oil market could see more price spikes and more hedging frenzies in the weeks ahead.&nbsp;(With inputs from the agencies) &nbsp;

US oil firms seize on Middle East-driven price spike to hedge at profitable levels, with June 13 marking record trading on Aegis as geopolitical risks roil energy markets.

As the Israel–Iran conflict reignites fears of a wider Middle East war, its aftershocks are already rippling through global energy markets. For US oil producers, this moment has become a strategic opportunity. With crude prices surging, they are rushing to hedge against future volatility, triggering record volumes of oil price hedging trades. Oil prices spike after Israel’s surprise strike on Iran On June 13, oil prices recorded their sharpest single day jump since July 2022. West Texas Intermediate (WTI) crude futures surged 7 per cent to around $73 per barrel, after Israel carried out a surprise strike on Iran, reigniting geopolitical tensions in the Middle East. The rally continued into the following week, with WTI closing Friday near $75 per barrel. According to Reuters, this sudden uptick gave US producers a rare window to lock in prices above budget for the first time in months. Record hedging volumes on Aegis platform The surge in prices led to a rush of hedging activity. Aegis Hedging, which manages hedging for about 25–30 per cent of total US oil output, reported record volume and the largest number of trades ever executed on its platform on June 13, as per Reuters. US oil production currently stands at around 13.56 million barrels per day, based on the latest government data. As per Aegis, the June 13 price spike, driven more by geopolitical risk than traditional supply-demand factors created a six-month hedging opportunity window. Hedging reportedly allows producers to lock in future oil prices and shield themselves from market volatility, a crucial move when global prices are affected by sudden conflict-driven moves rather than fundamental trends. From four-year lows to sudden opportunity Just weeks earlier, producers were grappling with unviable price levels. In May, crude had dropped to a four-year low of $57 per barrel, amid an output hike by OPEC+ and ongoing global trade friction. US crude futures remained below $65 per barrel, the average profitable drilling threshold, for over two months, from April 4 to June 9, according to LSEG and the Dallas Federal Reserve’s Q1 2025 survey cited by Reuters. That changed overnight on June 13. “Producers recognised that this could be a fleeting issue,” said Matt Marshall, President of Aegis Hedging, as quoted by Reuters. “Instead of choosing conservative options with low-price floors, many opted to aggressively lock in high prices.” Permian Basin players and lending pressure For companies like Black Mountain Energy, operating in the Permian Basin, the strategy is more than opportunistic, it’s also financial. “We watch for accretive pricing to our existing hedges and layer in new ones to reduce risk and meet our reserve-based lending covenants,” Rhett Bennett, CEO of Black Mountain Energy told Reuters. Such covenants are tied to the value of a company’s oil and gas reserves and influence the credit available from lenders. Securing high-price hedges helps maintain favourable loan terms. Options market echoes bullish sentiment Not just producers, traders, too, jumped on the bandwagon. On the same day, June 13, a surge in options trading reflected market bets on further price increases, as per Reuters. A total of 33,411 call options for $80 WTI crude expiring in August 2025 were exchanged on the Chicago Mercantile Exchange, the highest volume of these contracts this year, according to CME Group data. Overall, trading volumes touched 681,000 contracts that day, highlighting how risk events in geopolitics are now reshaping expectations in the energy derivatives market. What next? The Israel–Iran conflict has reintroduced a geopolitical risk premium into oil prices. While producers capitalise on the current price surge, volatility remains a constant threat. As tensions in the Middle East persist and the US heads into election season with President Trump doubling down on energy independence, the oil market could see more price spikes and more hedging frenzies in the weeks ahead. (With inputs from the agencies)

Oil prices surge as Israel–Iran conflict erupts, prompting US producers to lock in profits through record hedging trades.

US oil firms lock in $75 crude after Israel–Iran strike triggers price jump

As the Israel–Iran conflict enters its second week, the battleground is no longer limited to the skies. Both nations are now locked in a parallel war of numbers, where missile interceptions cost millions, oil exports vanish overnight, and households brace for tax hikes.&nbsp;For Israel, already burdened by long-running conflicts in Gaza and Lebanon, the question is urgent: Can Tel Aviv’s economy afford another war? For Iran, with its currency in freefall and energy infrastructure under siege, the challenge is one of endurance.&nbsp;And now, there’s a new risk looming on the horizon: the potential closure of the Strait of Hormuz, one of the world’s most critical energy chokepoints.Here’s a deep dive into how the war is straining both nations militarily, fiscally, and economically and what could happen if Tehran acts on its threat.<h2>Israel’s most expensive war yet</h2>In the first 48 hours alone, Israel’s confrontation with Iran reportedly cost a staggering 5.5 billion shekels ($1.45 billion), according to Ynet News.That reportedly amounts to over $700 million per day, and if hostilities continue for a month, the cost could cross $12 billion, surpassing the final bill for the 2023 Gaza war.&nbsp;Driving these soaring costs are Israel’s advanced defence systems. Each David’s Sling or Arrow-3 missile interception costs anywhere between $700,000 and $4 million, as reported by the Institute for National Security Studies.The deployment of F-35 fighter jets over Iranian territory adds further strain, with flight operations costing $10,000 per hour per jet, excluding ammunition and logistics.&nbsp;Israel could reportedly be spending up to $1 billion per day on military operations alone.<h2>Budget pressures and the deficit test</h2>To fund this military mobilisation, Israel has significantly expanded its defence budget, from $17 billion in 2023 to $28 billion in 2024, and a projected $34 billion in 2025. That would amount to nearly 9 per cent of GDP, second only to Ukraine, according to SIPRI.To finance the surge, the government has increased Value Added Tax (VAT) to 18 per cent, alongside hikes in healthcare and national insurance. However, these measures may fall short.&nbsp;The Ministry of Finance warns that Israel could breach its 4.9 per cent deficit ceiling (approximately $27.6 billion). Compounding the issue, GDP growth forecasts for 2025 have been slashed, from 4.3 per cent to 3.6 per cent, according to the Israel Central Bureau of Statistics.<h2>Civilian costs add to the burden</h2>The economic impact of the war is being felt far beyond the battlefield. Over 5,000 Israeli civilians have been evacuated due to missile strikes from Iran, with the government footing the bill for temporary accommodation in hotels, as per Israel’s National Public Diplomacy Directorate.Damage to urban infrastructure is extensive. Engineers quoted by Reuters say restoring just one damaged skyscraper in Tel Aviv could cost tens of millions of dollars.&nbsp;Meanwhile, day-to-day life remains disrupted: Israel’s main international airport was shut for several days, schools remain closed, and only partial workplace re-openings have been permitted by civil defence authorities.<h2>Tech resilience vs workforce crunch</h2>Israel’s high-tech sector remains a relative bright spot. Contributing 20 per cent of GDP and 64 per cent of national exports, the industry has shown resilience even during wartime.&nbsp;&nbsp;The Tel Aviv Stock Exchange continues to outperform global peers, reflecting cautious investor confidence.&nbsp;Yet cracks are emerging. For the first time in a decade, employment in the tech sector declined in 2024, according to the Israel Innovation Authority. Skilled workers are increasingly choosing to relocate abroad, triggering fears of a brain drain.&nbsp;At the same time, widespread reservist call-ups, the cancellation of Palestinian work permits, and logistical bottlenecks have caused over 60,000 Israeli firms to shut down this year, as reported by CofaceBDI.<h2>What if Iran closes the Strait of Hormuz?</h2>Amid mounting pressure, Iran has repeated its long-standing threat: to close the Strait of Hormuz. This narrow waterway, just 33 kilometres wide, is the world’s most critical oil transit chokepoint.&nbsp;Every day, around 21 million barrels of crude oil and over one-third of global liquefied natural gas (LNG) flow through this strait.It connects the Persian Gulf to global markets, enabling energy exports from Saudi Arabia, Iraq, Kuwait, Iran, and the UAE, most of which head to Asia.&nbsp;While Tehran has made similar threats in the past, it has never fully acted. Even during the 1980s “Tanker War,” when over 450 vessels were attacked, the Strait remained partially open. Today, the threat alone is enough to rattle global markets.&nbsp;According to Kpler, oil prices have already jumped, with Brent crude touching a five-month high. Analysts warn that if Iran attempts even a partial blockade, prices could cross $100 per barrel.&nbsp;However, a closure would hurt Iran, too. Over 90 per cent of Iranian oil, much of it routed unofficiallygoes to China.&nbsp;If the Strait shuts down, Tehran risks cutting off its own revenue lifeline. China, Iran’s top buyer, is unlikely to support such a move.The US, which sources most of its oil from Canada, would remain relatively insulated. Israel imports oil via the Mediterranean, largely from Azerbaijan, Gabon, and the US, so its direct exposure is minimal.&nbsp;But nations like India, Japan, and South Korea—heavily reliant on Gulf energy would face severe supply disruptions. Insurance and shipping costs through the Strait have already spiked amid growing security concerns.&nbsp;In short: the Strait of Hormuz is the global oil artery. Even short-term disruptions could cause lasting economic shockwaves.<h2>Oil market enters panic zone</h2>The financial markets are already showing signs of strain.&nbsp;From below $63 a barrel at the end of May, Brent crude surged above $77, driven by fears of conflict escalation, as per Reuters. While prices briefly fell by 2 per cent on Friday, Brent is still set for its third straight weekly gain.&nbsp;Citigroup has warned that if Iran closes the Strait of Hormuz, oil could spike to $90. Jennifer McKeown, chief global economist at Capital Economics, says if the US becomes directly involved in the war, Brent could surge to as high as $130–$150 per barrel.&nbsp;Almost 20 per cent of global oil flows through the Strait, making it a critical vulnerability. Current Brent prices also carry a $10 geopolitical premium, according to traders quoted by Bloomberg.&nbsp;Meanwhile, China’s record oil stockpiles are offering some buffer. As the biggest buyer of Iranian crude, Chinese refiners remain calm for now despite the crisis building in West Asia.&nbsp;However, a further jump in crude could derail monetary easing plans by central banks. A surge in oil-driven inflation is a risk major economies want to avoid, especially amid Trump’s renewed tariff policies.&nbsp;As Reuters reports, central banks are likely to delay rate cuts if oil breaches the $100 threshold again. For now, markets are bracing for volatility but haven’t fully priced in the worst-case scenario yet.<h2>What about Iran’s economy?</h2>Iran, long under US-led sanctions, is facing fresh economic wounds as Israeli airstrikes target its energy infrastructure.&nbsp;According to Kpler, Iranian oil exports have fallen sharply, from 242,000 barrels per day earlier this year to just 102,000 bpd in the week ending June 16. Israeli missiles have partially disabled the South Pars gas field, which is responsible for 80 per cent of Iran’s natural gas production.&nbsp;Meanwhile, Kharg Island, Iran’s primary export terminal for crude oil—has seen no tanker movement since last Friday, based on LSEG satellite data. That effectively freezes most of Iran’s seaborne oil exports.<h2>Tehran’s finances under fire</h2>Even before the latest conflict, Iran’s economy was running on thin margins. The Iranian rial has lost over 90 per cent of its value since 2018.Inflation is officially at 40 per cent, but independent analysts such as TS Lombard estimate it could be even higher.&nbsp;Iran’s oil revenue, once exceeding $100 billion in 2016—was just $50 billion across 2022–23, according to the US Energy Information Administration.Roughly 22–27 per cent of Iranians now live below the poverty line, according to the Institute of Labour and Social Welfare, as cited by Tasnim News.Tehran allocates about 3–5 per cent of GDP, around $12 billion annually for military purposes.&nbsp;&nbsp;While its $33 billion in foreign reserves provides a cushion, analysts warn that using these reserves to fund extended military operations would threaten Iran’s long-term solvency.<h2>Who will blink first?</h2>Both Israel and Iran are approaching economic red lines.&nbsp;For Israel, the challenge lies in juggling three simultaneous fronts—Gaza, Lebanon, and Iran—without crossing critical fiscal thresholds. Ratings agency S&amp;P has hinted that a prolonged conflict could trigger a credit downgrade, raising Israel’s borrowing costs and spooking investors.Iran’s situation is arguably more precarious. With energy revenues slashed, inflation surging, and no real access to global financial systems, Tehran has fewer levers to pull.&nbsp;Unlike Israel, it cannot borrow easily or attract foreign investment.&nbsp;Neither side wants a drawn-out war. But every extra day of conflict piles on economic risk and tests national endurance.As this isn’t just a military clash—it’s a test of economic survival. &nbsp;

Amid mounting pressure, Iran has repeated its long-standing threat: to close the Strait of Hormuz. This narrow waterway, just 33 kilometres wide, is the world’s most critical oil transit chokepoint.

As the Israel–Iran conflict enters its second week, the battleground is no longer limited to the skies. Both nations are now locked in a parallel war of numbers, where missile interceptions cost millions, oil exports vanish overnight, and households brace for tax hikes. For Israel, already burdened by long-running conflicts in Gaza and Lebanon, the question is urgent: Can Tel Aviv’s economy afford another war? For Iran, with its currency in freefall and energy infrastructure under siege, the challenge is one of endurance. And now, there’s a new risk looming on the horizon: the potential closure of the Strait of Hormuz, one of the world’s most critical energy chokepoints. Here’s a deep dive into how the war is straining both nations militarily, fiscally, and economically and what could happen if Tehran acts on its threat. Israel’s most expensive war yet In the first 48 hours alone, Israel’s confrontation with Iran reportedly cost a staggering 5.5 billion shekels ($1.45 billion), according to Ynet News. That reportedly amounts to over $700 million per day, and if hostilities continue for a month, the cost could cross $12 billion, surpassing the final bill for the 2023 Gaza war. Driving these soaring costs are Israel’s advanced defence systems. Each David’s Sling or Arrow-3 missile interception costs anywhere between $700,000 and $4 million, as reported by the Institute for National Security Studies. The deployment of F-35 fighter jets over Iranian territory adds further strain, with flight operations costing $10,000 per hour per jet, excluding ammunition and logistics. Israel could reportedly be spending up to $1 billion per day on military operations alone. Budget pressures and the deficit test To fund this military mobilisation, Israel has significantly expanded its defence budget, from $17 billion in 2023 to $28 billion in 2024, and a projected $34 billion in 2025. That would amount to nearly 9 per cent of GDP, second only to Ukraine, according to SIPRI. To finance the surge, the government has increased Value Added Tax (VAT) to 18 per cent, alongside hikes in healthcare and national insurance. However, these measures may fall short. The Ministry of Finance warns that Israel could breach its 4.9 per cent deficit ceiling (approximately $27.6 billion). Compounding the issue, GDP growth forecasts for 2025 have been slashed, from 4.3 per cent to 3.6 per cent, according to the Israel Central Bureau of Statistics. Civilian costs add to the burden The economic impact of the war is being felt far beyond the battlefield. Over 5,000 Israeli civilians have been evacuated due to missile strikes from Iran, with the government footing the bill for temporary accommodation in hotels, as per Israel’s National Public Diplomacy Directorate. Damage to urban infrastructure is extensive. Engineers quoted by Reuters say restoring just one damaged skyscraper in Tel Aviv could cost tens of millions of dollars. Meanwhile, day-to-day life remains disrupted: Israel’s main international airport was shut for several days, schools remain closed, and only partial workplace re-openings have been permitted by civil defence authorities. Tech resilience vs workforce crunch Israel’s high-tech sector remains a relative bright spot. Contributing 20 per cent of GDP and 64 per cent of national exports, the industry has shown resilience even during wartime. The Tel Aviv Stock Exchange continues to outperform global peers, reflecting cautious investor confidence. Yet cracks are emerging. For the first time in a decade, employment in the tech sector declined in 2024, according to the Israel Innovation Authority. Skilled workers are increasingly choosing to relocate abroad, triggering fears of a brain drain. At the same time, widespread reservist call-ups, the cancellation of Palestinian work permits, and logistical bottlenecks have caused over 60,000 Israeli firms to shut down this year, as reported by CofaceBDI. What if Iran closes the Strait of Hormuz? Amid mounting pressure, Iran has repeated its long-standing threat: to close the Strait of Hormuz. This narrow waterway, just 33 kilometres wide, is the world’s most critical oil transit chokepoint. Every day, around 21 million barrels of crude oil and over one-third of global liquefied natural gas (LNG) flow through this strait. It connects the Persian Gulf to global markets, enabling energy exports from Saudi Arabia, Iraq, Kuwait, Iran, and the UAE, most of which head to Asia. While Tehran has made similar threats in the past, it has never fully acted. Even during the 1980s “Tanker War,” when over 450 vessels were attacked, the Strait remained partially open. Today, the threat alone is enough to rattle global markets. According to Kpler, oil prices have already jumped, with Brent crude touching a five-month high. Analysts warn that if Iran attempts even a partial blockade, prices could cross $100 per barrel. However, a closure would hurt Iran, too. Over 90 per cent of Iranian oil, much of it routed unofficiallygoes to China. If the Strait shuts down, Tehran risks cutting off its own revenue lifeline. China, Iran’s top buyer, is unlikely to support such a move. The US, which sources most of its oil from Canada, would remain relatively insulated. Israel imports oil via the Mediterranean, largely from Azerbaijan, Gabon, and the US, so its direct exposure is minimal. But nations like India, Japan, and South Korea—heavily reliant on Gulf energy would face severe supply disruptions. Insurance and shipping costs through the Strait have already spiked amid growing security concerns. In short: the Strait of Hormuz is the global oil artery. Even short-term disruptions could cause lasting economic shockwaves. Oil market enters panic zone The financial markets are already showing signs of strain. From below $63 a barrel at the end of May, Brent crude surged above $77, driven by fears of conflict escalation, as per Reuters. While prices briefly fell by 2 per cent on Friday, Brent is still set for its third straight weekly gain. Citigroup has warned that if Iran closes the Strait of Hormuz, oil could spike to $90. Jennifer McKeown, chief global economist at Capital Economics, says if the US becomes directly involved in the war, Brent could surge to as high as $130–$150 per barrel. Almost 20 per cent of global oil flows through the Strait, making it a critical vulnerability. Current Brent prices also carry a $10 geopolitical premium, according to traders quoted by Bloomberg. Meanwhile, China’s record oil stockpiles are offering some buffer. As the biggest buyer of Iranian crude, Chinese refiners remain calm for now despite the crisis building in West Asia. However, a further jump in crude could derail monetary easing plans by central banks. A surge in oil-driven inflation is a risk major economies want to avoid, especially amid Trump’s renewed tariff policies. As Reuters reports, central banks are likely to delay rate cuts if oil breaches the $100 threshold again. For now, markets are bracing for volatility but haven’t fully priced in the worst-case scenario yet. What about Iran’s economy? Iran, long under US-led sanctions, is facing fresh economic wounds as Israeli airstrikes target its energy infrastructure. According to Kpler, Iranian oil exports have fallen sharply, from 242,000 barrels per day earlier this year to just 102,000 bpd in the week ending June 16. Israeli missiles have partially disabled the South Pars gas field, which is responsible for 80 per cent of Iran’s natural gas production. Meanwhile, Kharg Island, Iran’s primary export terminal for crude oil—has seen no tanker movement since last Friday, based on LSEG satellite data. That effectively freezes most of Iran’s seaborne oil exports. Tehran’s finances under fire Even before the latest conflict, Iran’s economy was running on thin margins. The Iranian rial has lost over 90 per cent of its value since 2018. Inflation is officially at 40 per cent, but independent analysts such as TS Lombard estimate it could be even higher. Iran’s oil revenue, once exceeding $100 billion in 2016—was just $50 billion across 2022–23, according to the US Energy Information Administration. Roughly 22–27 per cent of Iranians now live below the poverty line, according to the Institute of Labour and Social Welfare, as cited by Tasnim News. Tehran allocates about 3–5 per cent of GDP, around $12 billion annually for military purposes. While its $33 billion in foreign reserves provides a cushion, analysts warn that using these reserves to fund extended military operations would threaten Iran’s long-term solvency. Who will blink first? Both Israel and Iran are approaching economic red lines. For Israel, the challenge lies in juggling three simultaneous fronts—Gaza, Lebanon, and Iran—without crossing critical fiscal thresholds. Ratings agency S&P has hinted that a prolonged conflict could trigger a credit downgrade, raising Israel’s borrowing costs and spooking investors. Iran’s situation is arguably more precarious. With energy revenues slashed, inflation surging, and no real access to global financial systems, Tehran has fewer levers to pull. Unlike Israel, it cannot borrow easily or attract foreign investment. Neither side wants a drawn-out war. But every extra day of conflict piles on economic risk and tests national endurance. As this isn’t just a military clash—it’s a test of economic survival.

From missile defence bills to shrinking oil exports and inflation crises , Israel and Iran are both waging wars their economies might not afford. Here’s how the fighting is reshaping financial futures in West Asia.

Israel–Iran war strains economies: What happens if Strait of Hormuz shuts down?

Oil prices retreated slightly on Friday after US President Donald Trump signalled that a decision on whether to launch a military strike on Iran would be made within two weeks.&nbsp;&nbsp;The announcement tempered immediate fears of escalation, even as fighting between Israel and Iran continues to intensify.&nbsp;Brent crude fell toward $77 a barrel, trimming gains from earlier in the week, while West Texas Intermediate (WTI) held steady near $74. The pullback followed a volatile week in the energy markets, driven by heightened geopolitical risks in the Middle East.&nbsp;As reported by Bloomberg, Trump’s dictated message, conveyed through White House spokesperson Karoline Leavitt, said there remained a “substantial chance of negotiations” with Tehran. Leavitt added that the timeline for a final decision was still open, but the administration expected to act within two weeks.<h2>A volatile week in the oil market</h2>Oil futures experienced significant swings over the past five days. According to Bloomberg, price volatility spiked, timespreads widened sharply, and bullish call options surged briefly surpassing levels seen during Russia’s invasion of Ukraine in 2022.&nbsp;Brent had closed nearly 3 per cent higher on Thursday, following concerns of a potential US strike over the weekend. However, Trump’s statement late Thursday helped ease some of those fears and brought a temporary pause to the market rally.&nbsp;Analysts say prices remain elevated due to geopolitical premiums. Goldman Sachs estimates that ongoing conflict in the Middle East is adding about $10 a barrel to crude benchmarks.<h2>Israel–Iran conflict: Infrastructure intact, tensions rising</h2>The broader context for market volatility is the escalating conflict between Israel and Iran.&nbsp;As per Reuters, Israel has carried out strikes on Iranian nuclear and military facilities in recent days, including targets near Natanz, Arak, and air defence sites around Tehran. In response, Iran launched missile and drone attacks on Israeli cities, including an airstrike that hit Soroka Medical Center in Beersheba, injuring dozens of civilians.&nbsp;While the attacks have caused extensive damage to infrastructure and led to civilian casualties on both sides, Iran’s oil production and export infrastructure have so far remained unaffected. Satellite images reviewed by Bloomberg suggest that crude storage tanks at Kharg Island, Iran’s main export terminal, are full, indicating the country is moving oil out rapidly amid fears of wider sanctions or conflict.&nbsp;The biggest strategic concern remains the Strait of Hormuz, a narrow waterway through which about 20 per cent of global oil supply flows. So far, there are no signs of disruption, but markets continue to monitor the region closely.<h2>What next?</h2>According to Reuters, senior US officials have been preparing for potential military action, but internal discussions point to a cautious approach, balancing strategic objectives with the risk of further regional instability. Trump’s two-week timeline appears to be aimed at allowing room for diplomatic outreach while keeping pressure on Tehran.&nbsp;Market analysts expect oil prices to remain in the $70–$80 range in the near term, with risk premiums rising if the conflict escalates further or if US involvement becomes imminent.&nbsp;(With inputs from the agencies) &nbsp;

Brent crude slid towards $77 per barrel, while WTI stayed near $74. The market experienced significant volatility and price swings due to geopolitical tensions. 

Oil prices retreated slightly on Friday after US President Donald Trump signalled that a decision on whether to launch a military strike on Iran would be made within two weeks. The announcement tempered immediate fears of escalation, even as fighting between Israel and Iran continues to intensify. Brent crude fell toward $77 a barrel, trimming gains from earlier in the week, while West Texas Intermediate (WTI) held steady near $74. The pullback followed a volatile week in the energy markets, driven by heightened geopolitical risks in the Middle East. As reported by Bloomberg, Trump’s dictated message, conveyed through White House spokesperson Karoline Leavitt, said there remained a “substantial chance of negotiations” with Tehran. Leavitt added that the timeline for a final decision was still open, but the administration expected to act within two weeks. A volatile week in the oil market Oil futures experienced significant swings over the past five days. According to Bloomberg, price volatility spiked, timespreads widened sharply, and bullish call options surged briefly surpassing levels seen during Russia’s invasion of Ukraine in 2022. Brent had closed nearly 3 per cent higher on Thursday, following concerns of a potential US strike over the weekend. However, Trump’s statement late Thursday helped ease some of those fears and brought a temporary pause to the market rally. Analysts say prices remain elevated due to geopolitical premiums. Goldman Sachs estimates that ongoing conflict in the Middle East is adding about $10 a barrel to crude benchmarks. Israel–Iran conflict: Infrastructure intact, tensions rising The broader context for market volatility is the escalating conflict between Israel and Iran. As per Reuters, Israel has carried out strikes on Iranian nuclear and military facilities in recent days, including targets near Natanz, Arak, and air defence sites around Tehran. In response, Iran launched missile and drone attacks on Israeli cities, including an airstrike that hit Soroka Medical Center in Beersheba, injuring dozens of civilians. While the attacks have caused extensive damage to infrastructure and led to civilian casualties on both sides, Iran’s oil production and export infrastructure have so far remained unaffected. Satellite images reviewed by Bloomberg suggest that crude storage tanks at Kharg Island, Iran’s main export terminal, are full, indicating the country is moving oil out rapidly amid fears of wider sanctions or conflict. The biggest strategic concern remains the Strait of Hormuz, a narrow waterway through which about 20 per cent of global oil supply flows. So far, there are no signs of disruption, but markets continue to monitor the region closely. What next? According to Reuters, senior US officials have been preparing for potential military action, but internal discussions point to a cautious approach, balancing strategic objectives with the risk of further regional instability. Trump’s two-week timeline appears to be aimed at allowing room for diplomatic outreach while keeping pressure on Tehran. Market analysts expect oil prices to remain in the $70–$80 range in the near term, with risk premiums rising if the conflict escalates further or if US involvement becomes imminent. (With inputs from the agencies)

Oil prices dipped slightly as President Trump suggested a decision on a potential military strike on Iran would come in two weeks, alleviating immediate escalation fears amidst ongoing conflict.

Oil prices drop as Trump signals two-week window on Iran action

Iran has repeatedly warned that it might block Strait of Hormuz, a narrow sea route, in response to pressure from Western countries, although it has never actually done so.On June 13, Israel carried out attacks on Iran, claiming it hit nuclear sites, missile production centres, and top military officials. This marked the beginning of a long-term mission aimed at stopping Iran from developing a nuclear weapon.Iran has always denied that it wants to build a nuclear weapon. However, in the past, it has warned that it might shut down the Strait of Hormuz in response to pressure from Western countries. Experts say that if this important waterway is blocked, it could disrupt global trade and cause oil prices around the world to rise sharply.The Strait of Hormuz is a narrow waterway located between Oman and Iran. It connects the Persian Gulf in the north to the Gulf of Oman and the Arabian Sea in the south.At its narrowest point, the strait is about 21 miles (33 kilometres) wide. However, ships can only pass through a lane that is just 2 miles (3 kilometres) wide in each direction, making it a very tight and important passage for global shipping.<h2>Why is the Strait of Hormuz important?</h2>Nearly 20 per cent of the world’s oil passes through this narrow waterway. From early 2022 up to last month, around 17.8 to 20.8 million barrels of crude oil, gas condensate, and other fuels were transported through the strait every single day, according to data shared by Vortexa and reported by Hindu Business Line. This makes the Strait one of the most important routes for global energy supply.Major oil-producing countries like Saudi Arabia, Iran, the United Arab Emirates (UAE), Kuwait, and Iraq—most of them members of OPEC—send most of their crude oil through the Strait of Hormuz, mainly to countries in Asia. However, both the UAE and Saudi Arabia have been trying to create alternative routes to avoid depending only on this narrow passage.According to the U.S. Energy Information Administration, as of June last year, about 2.6 million barrels per day of extra capacity from pipelines in the UAE and Saudi Arabia could be used to move oil without going through the Strait of Hormuz.Qatar, one of the world’s top exporters of liquefied natural gas (LNG), sends nearly all of its LNG shipments through this narrow strait.Although Iran has often warned that it might block the strait in response to foreign pressure, it has never actually done so.To keep the area safe for international trade, the U.S. Navy’s Fifth Fleet, based in Bahrain, is responsible for protecting commercial ships passing through the region.<h2>How Distant Wars Drain Your Wallet</h2>Many times, we feel that global conflicts are too far away to affect us. But the truth is, events happening thousands of miles away can impact our daily lives—like the price we pay for fuel or groceries. The current tension between Israel and Iran is a clear example of this. The biggest concern for most people? Rising crude oil prices.In just five days, Brent crude prices jumped by 7 per cent, crossing $70 per barrel. For India—which buys 89 per cent of its oil from other countries—even a small price rise can have a big impact on the entire economy.In the financial year 2024–25, India spent $137 billion on oil imports, making up about 15 per cent of the country’s total import expenses. So, when global oil prices go up, it affects almost everything—from petrol and diesel to food prices and transportation costs. It’s like an extra hidden burden on both ordinary people and businesses.<h2>What a $10 Increase in Oil Prices Really Means</h2>When crude oil prices go up by $10, it usually affects the economy in two major ways. The country’s overall growth (GDP) may slow down by about 0.3 to 0.4 per cent, and inflation (CPI) may rise by around 0.4 per cent. But these changes aren’t just numbers in reports—they impact everyday life. Families, businesses, and the economy as a whole start feeling the pinch in many different ways.Here's a simple example to explain how a $10 increase in crude oil prices can affect everyday life:<h3>Oil Price Ripple Effect</h3>Let’s say crude oil goes up by $10 per barrel.<ul><li>Fuel prices rise: Petrol and diesel become costlier. If you were paying ₹100 per litre, you might now pay ₹105 or more. This directly affects people who drive or use public transport.</li><li>Transportation costs increase: Trucks and delivery vehicles use more expensive fuel, so transporting goods like vegetables, fruits, and groceries costs more. That means prices at your local market or supermarket also go up.</li><li>Higher production costs: Factories that use oil or gas to run machines or generate power also face higher bills. To make up for that, they raise the prices of products like packaged foods, paints, tyres, or even plastic items.</li><li>Air travel becomes expensive: Airlines spend more on aviation fuel, so ticket prices go up. A budget flight from Bengaluru to Delhi that used to cost ₹4,000 might now cost ₹4,500 or more.</li><li>Household budget is hit: As everything from cooking gas to daily groceries gets costlier, families have to cut back on spending or save less. This affects the overall economy because when people spend less, businesses earn less too.</li></ul>So, a $10 oil hike may seem small, but it touches almost every corner of life—like a chain reaction.<h3>Inflation’s Hidden Daily Cost</h3>An example of how a 0.4% increase in CPI (Consumer Price Index) affects you:The CPI measures the average change in the prices of goods and services people use every day—like food, fuel, clothes, transport, and rent. So, when CPI goes up by 0.4%, it means that the overall cost of living has increased by that much.Let’s say your monthly household expenses are ₹50,000. A 0.4 per cent rise in CPI means your costs will go up by:₹50,000 × 0.004 = ₹200 So now, you’ll be spending ₹50,200 per month for the same things.It might not seem like a big jump at first—but over a year, that’s ₹2,400 extra, just due to inflation caused by rising oil prices. And this is just a basic estimate—if oil prices stay high or keep increasing, the impact could be even more.In short, a 0.4 per cent CPI rise is like a slow, silent drain on your wallet.<h3>Industries Likely to Face Rising Costs</h3><ul><li>Airlines: Fuel is one of the biggest expenses for airlines. When oil prices go up, jet fuel becomes costlier. This reduces their profits. Airlines may either bear the extra cost or increase ticket prices, which could make people travel less. For instance, InterGlobe Aviation (which operates Indigo) &nbsp;spent around 31.1 per cent of its earnings on fuel in the financial year 2025.</li><li>Logistics and FMCG (Fast-Moving Consumer Goods): Transporting goods becomes more expensive when fuel prices rise. Delivery companies have to pay more for diesel, and brands that sell daily-use items or online products also face higher transport costs. This either cuts into their profit or forces them to increase prices, which can reduce customer demand.</li><li>Paint Companies: Paint manufacturers rely on raw materials like binders, solvents, and additives—all of which are derived from crude oil. When oil prices go up, the cost of these materials also increases, making it more expensive to produce paint.</li><li>Auto Companies: The auto industry is closely tied to oil. When fuel prices rise, it becomes costlier to run petrol or diesel vehicles. As a result, people may postpone buying new cars or choose smaller, fuel-efficient ones. This can lead to a drop in sales and tighter profit margins. To stay competitive, automakers may reduce prices, offer attractive loans, or cut production costs. Simply put, higher oil prices reduce demand and push companies to adapt.</li><li>Fertiliser Companies: Fertilisers like urea and DAP (diammonium phosphate) use ammonia as a key ingredient, and ammonia is made using natural gas. So, when oil and gas prices rise, the cost of making fertilisers also goes up. This affects fertiliser companies because their production becomes more expensive. Sometimes, they have to increase prices, which can hurt demand. Other times, they absorb the costs, which reduces their profits. In either case, rising fuel prices create a big challenge for the fertiliser industry.</li></ul><h3>Sectors That Could Do Well</h3><ul><li>Oil Refiners: When crude oil prices fluctuate sharply, the difference between the cost of buying crude oil and the price at which companies sell refined products like petrol, diesel, and jet fuel becomes important. This difference is called the crack spread. For example, if a refiner buys crude oil at ₹5,000 per barrel and sells the refined fuels for ₹6,500, the ₹1,500 difference is their profit margin. When this margin widens due to market conditions, oil refiners make more profit, even if crude prices are high.</li><li>Defence Companies: During times of global tension or war threats, governments tend to spend more on military preparedness. This results in increased orders for defence companies, boosting their revenue. Investors also consider these companies more stable during uncertain times, making their stocks more attractive.</li><li>Gold &amp; Bonds: When risk levels go up globally—like during wars or economic crises—investors often pull their money out of stocks and move it into safer assets like gold and bonds. This shift increases demand and prices for gold and bonds, helping existing investors earn better returns.</li></ul><h2>As an Investor, What Should You Watch?</h2>Here’s what you need to keep an eye on if you want to understand how rising oil prices could affect the Indian economy and markets:<ul><li>Brent Crude Above $80: When Brent crude oil trades above $80 per barrel, India’s oil import bill rises sharply. This pushes up inflation because fuel and transportation become costlier. As a result, foreign investors (FIIs) may start pulling money out of Indian markets, fearing lower profits. That can lead to a stock market correction. Example: If oil hits $90, petrol prices may rise by ₹4–₹5 per litre, impacting consumer spending and investor sentiment.</li><li>Rupee vs Dollar (USD/INR) Movement: India buys crude oil using US dollars. So, if the rupee weakens against the dollar, it makes oil even more expensive for India, worsening inflation. Investors should monitor how the rupee is trading compared to the dollar. Example: If ₹82 was worth 1 USD earlier and weakens to 85, the same oil shipment costs more rupees now—this pushes up overall fuel costs.</li><li>RBI’s Policy Signals: When inflation goes up due to expensive oil, the Reserve Bank of India (RBI) may avoid cutting interest rates—or may even raise them.</li></ul><h2>Why does RBI keep rates high?</h2>High interest rates help control inflation. By making loans and EMIs expensive, the RBI reduces demand for borrowing and spending. This helps cool off rising prices across the economy. But the flip side is that businesses borrow less, and consumers spend cautiously. That can slow down economic growth. Example: If inflation stays above 6 per cent, RBI may delay rate cuts for months, meaning your home loan EMIs won’t come down anytime soon.

Many times, we feel that global conflicts are too far away to affect us. But the truth is, events happening thousands of miles away can impact our daily lives—like the price we pay for fuel or groceries. The current tension between Israel and Iran is a clear example of this. 

Iran has repeatedly warned that it might block Strait of Hormuz, a narrow sea route, in response to pressure from Western countries, although it has never actually done so. On June 13, Israel carried out attacks on Iran, claiming it hit nuclear sites, missile production centres, and top military officials. This marked the beginning of a long-term mission aimed at stopping Iran from developing a nuclear weapon. Iran has always denied that it wants to build a nuclear weapon. However, in the past, it has warned that it might shut down the Strait of Hormuz in response to pressure from Western countries. Experts say that if this important waterway is blocked, it could disrupt global trade and cause oil prices around the world to rise sharply. The Strait of Hormuz is a narrow waterway located between Oman and Iran. It connects the Persian Gulf in the north to the Gulf of Oman and the Arabian Sea in the south. At its narrowest point, the strait is about 21 miles (33 kilometres) wide. However, ships can only pass through a lane that is just 2 miles (3 kilometres) wide in each direction, making it a very tight and important passage for global shipping. Why is the Strait of Hormuz important? Nearly 20 per cent of the world’s oil passes through this narrow waterway. From early 2022 up to last month, around 17.8 to 20.8 million barrels of crude oil, gas condensate, and other fuels were transported through the strait every single day, according to data shared by Vortexa and reported by Hindu Business Line. This makes the Strait one of the most important routes for global energy supply. Major oil-producing countries like Saudi Arabia, Iran, the United Arab Emirates (UAE), Kuwait, and Iraq—most of them members of OPEC—send most of their crude oil through the Strait of Hormuz, mainly to countries in Asia. However, both the UAE and Saudi Arabia have been trying to create alternative routes to avoid depending only on this narrow passage. According to the U.S. Energy Information Administration, as of June last year, about 2.6 million barrels per day of extra capacity from pipelines in the UAE and Saudi Arabia could be used to move oil without going through the Strait of Hormuz. Qatar, one of the world’s top exporters of liquefied natural gas (LNG), sends nearly all of its LNG shipments through this narrow strait. Although Iran has often warned that it might block the strait in response to foreign pressure, it has never actually done so. To keep the area safe for international trade, the U.S. Navy’s Fifth Fleet, based in Bahrain, is responsible for protecting commercial ships passing through the region. How Distant Wars Drain Your Wallet Many times, we feel that global conflicts are too far away to affect us. But the truth is, events happening thousands of miles away can impact our daily lives—like the price we pay for fuel or groceries. The current tension between Israel and Iran is a clear example of this. The biggest concern for most people? Rising crude oil prices. In just five days, Brent crude prices jumped by 7 per cent, crossing $70 per barrel. For India—which buys 89 per cent of its oil from other countries—even a small price rise can have a big impact on the entire economy. In the financial year 2024–25, India spent $137 billion on oil imports, making up about 15 per cent of the country’s total import expenses. So, when global oil prices go up, it affects almost everything—from petrol and diesel to food prices and transportation costs. It’s like an extra hidden burden on both ordinary people and businesses. What a $10 Increase in Oil Prices Really Means When crude oil prices go up by $10, it usually affects the economy in two major ways. The country’s overall growth (GDP) may slow down by about 0.3 to 0.4 per cent, and inflation (CPI) may rise by around 0.4 per cent. But these changes aren’t just numbers in reports—they impact everyday life. Families, businesses, and the economy as a whole start feeling the pinch in many different ways. Here's a simple example to explain how a $10 increase in crude oil prices can affect everyday life: Oil Price Ripple Effect Let’s say crude oil goes up by $10 per barrel. Fuel prices rise: Petrol and diesel become costlier. If you were paying ₹100 per litre, you might now pay ₹105 or more. This directly affects people who drive or use public transport. Transportation costs increase: Trucks and delivery vehicles use more expensive fuel, so transporting goods like vegetables, fruits, and groceries costs more. That means prices at your local market or supermarket also go up. Higher production costs: Factories that use oil or gas to run machines or generate power also face higher bills. To make up for that, they raise the prices of products like packaged foods, paints, tyres, or even plastic items. Air travel becomes expensive: Airlines spend more on aviation fuel, so ticket prices go up. A budget flight from Bengaluru to Delhi that used to cost ₹4,000 might now cost ₹4,500 or more. Household budget is hit: As everything from cooking gas to daily groceries gets costlier, families have to cut back on spending or save less. This affects the overall economy because when people spend less, businesses earn less too. So, a $10 oil hike may seem small, but it touches almost every corner of life—like a chain reaction. Inflation’s Hidden Daily Cost An example of how a 0.4% increase in CPI (Consumer Price Index) affects you: The CPI measures the average change in the prices of goods and services people use every day—like food, fuel, clothes, transport, and rent. So, when CPI goes up by 0.4%, it means that the overall cost of living has increased by that much. Let’s say your monthly household expenses are ₹50,000. A 0.4 per cent rise in CPI means your costs will go up by: ₹50,000 × 0.004 = ₹200 So now, you’ll be spending ₹50,200 per month for the same things. It might not seem like a big jump at first—but over a year, that’s ₹2,400 extra, just due to inflation caused by rising oil prices. And this is just a basic estimate—if oil prices stay high or keep increasing, the impact could be even more. In short, a 0.4 per cent CPI rise is like a slow, silent drain on your wallet. Industries Likely to Face Rising Costs Airlines: Fuel is one of the biggest expenses for airlines. When oil prices go up, jet fuel becomes costlier. This reduces their profits. Airlines may either bear the extra cost or increase ticket prices, which could make people travel less. For instance, InterGlobe Aviation (which operates Indigo) spent around 31.1 per cent of its earnings on fuel in the financial year 2025. Logistics and FMCG (Fast-Moving Consumer Goods): Transporting goods becomes more expensive when fuel prices rise. Delivery companies have to pay more for diesel, and brands that sell daily-use items or online products also face higher transport costs. This either cuts into their profit or forces them to increase prices, which can reduce customer demand. Paint Companies: Paint manufacturers rely on raw materials like binders, solvents, and additives—all of which are derived from crude oil. When oil prices go up, the cost of these materials also increases, making it more expensive to produce paint. Auto Companies: The auto industry is closely tied to oil. When fuel prices rise, it becomes costlier to run petrol or diesel vehicles. As a result, people may postpone buying new cars or choose smaller, fuel-efficient ones. This can lead to a drop in sales and tighter profit margins. To stay competitive, automakers may reduce prices, offer attractive loans, or cut production costs. Simply put, higher oil prices reduce demand and push companies to adapt. Fertiliser Companies: Fertilisers like urea and DAP (diammonium phosphate) use ammonia as a key ingredient, and ammonia is made using natural gas. So, when oil and gas prices rise, the cost of making fertilisers also goes up. This affects fertiliser companies because their production becomes more expensive. Sometimes, they have to increase prices, which can hurt demand. Other times, they absorb the costs, which reduces their profits. In either case, rising fuel prices create a big challenge for the fertiliser industry. Sectors That Could Do Well Oil Refiners: When crude oil prices fluctuate sharply, the difference between the cost of buying crude oil and the price at which companies sell refined products like petrol, diesel, and jet fuel becomes important. This difference is called the crack spread. For example, if a refiner buys crude oil at ₹5,000 per barrel and sells the refined fuels for ₹6,500, the ₹1,500 difference is their profit margin. When this margin widens due to market conditions, oil refiners make more profit, even if crude prices are high. Defence Companies: During times of global tension or war threats, governments tend to spend more on military preparedness. This results in increased orders for defence companies, boosting their revenue. Investors also consider these companies more stable during uncertain times, making their stocks more attractive. Gold & Bonds: When risk levels go up globally—like during wars or economic crises—investors often pull their money out of stocks and move it into safer assets like gold and bonds. This shift increases demand and prices for gold and bonds, helping existing investors earn better returns. As an Investor, What Should You Watch? Here’s what you need to keep an eye on if you want to understand how rising oil prices could affect the Indian economy and markets: Brent Crude Above $80: When Brent crude oil trades above $80 per barrel, India’s oil import bill rises sharply. This pushes up inflation because fuel and transportation become costlier. As a result, foreign investors (FIIs) may start pulling money out of Indian markets, fearing lower profits. That can lead to a stock market correction. Example: If oil hits $90, petrol prices may rise by ₹4–₹5 per litre, impacting consumer spending and investor sentiment. Rupee vs Dollar (USD/INR) Movement: India buys crude oil using US dollars. So, if the rupee weakens against the dollar, it makes oil even more expensive for India, worsening inflation. Investors should monitor how the rupee is trading compared to the dollar. Example: If ₹82 was worth 1 USD earlier and weakens to 85, the same oil shipment costs more rupees now—this pushes up overall fuel costs. RBI’s Policy Signals: When inflation goes up due to expensive oil, the Reserve Bank of India (RBI) may avoid cutting interest rates—or may even raise them. Why does RBI keep rates high? High interest rates help control inflation. By making loans and EMIs expensive, the RBI reduces demand for borrowing and spending. This helps cool off rising prices across the economy. But the flip side is that businesses borrow less, and consumers spend cautiously. That can slow down economic growth. Example: If inflation stays above 6 per cent, RBI may delay rate cuts for months, meaning your home loan EMIs won’t come down anytime soon.

Many times, we feel that global conflicts are too far away to affect us. But the truth is, events happening thousands of miles away can impact our daily lives—like the price we pay for fuel or groceries. The current tension between Israel and Iran is a clear example of this.&nbsp;

How a $10 oil shock hits your wallet: What Indian investors must track now

Oil prices are rising sharply, and global markets are edging into risk-off mode as the Iran–Israel conflict shows no signs of slowing, entering its sixth day on Wednesday.&nbsp;&nbsp;The geopolitical crisis, centred near the Strait of Hormuz, is reviving fears of a global energy shock, even as central banks weigh the fallout on inflation and growth.&nbsp;Brent crude futures rose 19 cents to $76.64 a barrel in early trading, while US West Texas Intermediate climbed 23 cents to $75.07. That followed a 4 per cent spike in prices on Tuesday amid mounting concerns that the Middle East conflict could disrupt oil supplies.<h2>Strait of Hormuz back in focus</h2>Much of the market anxiety revolves around the Strait of Hormuz, the narrow chokepoint through which nearly 20 per cent of the world’s seaborne oil passes. According to Reuters, two tankers collided and caught fire near the strait on Tuesday, raising red flags about safety in the region.&nbsp;The United Kingdom Maritime Trade Operations also warned of “electronic interference” affecting ship navigation systems in the area, a possible sign of growing cyber-warfare threats tied to the conflict.&nbsp;Iran, the third-largest producer in OPEC, pumps around 3.3 million barrels per day. Should the fighting escalate, or sanctions intensify, traders expect disruptions to Iranian output though other OPEC members may struggle to compensate using spare capacity.<h2>Trump ups the ante</h2>On Tuesday, US President Donald Trump called for Iran’s “unconditional surrender” and sent additional fighter jets to the region, according to US officials quoted by Reuters. The US military buildup comes as part of an effort to deter further escalation, though markets fear it may have the opposite effect.&nbsp;Trump’s early departure from the Group of Seven summit in Canada only deepened investor unease. While there were hopes of progress on global trade talks, those evaporated as Trump returned to Washington citing Iran’s provocations.&nbsp;“The market was anxious to hopefully hear updates on trade agreements out of the G7 and the news of Trump leaving early was disappointing,” Eric Sterner of Apollon Wealth Management told Reuters.<h2>Wall Street wobbles</h2>The risk-off sentiment dragged down US stocks on Tuesday. The Dow Jones Industrial Average dropped 0.70 per cent, the S&amp;P 500 slipped 0.84 per cent, and the tech-heavy Nasdaq fell 0.91 per cent.&nbsp;Meanwhile, oil continued its upward climb, with Brent settling 4.52 per cent higher at $76.54 per barrel and US crude jumping 4.46 per cent to close at $74.97.&nbsp;The conflict is also fuelling demand for safe-haven assets. Yields on 10-year US Treasuries fell to 4.389 per cent, down 6.5 basis points from Monday, a sign of growing investor caution.&nbsp;The VIX volatility index, often called Wall Street’s “fear gauge,” rose to a four-week high of 21.6, though still far below pandemic or financial crisis peaks. Analysts said the current spike reflects concern but not full-scale panic yet.&nbsp;“This is like Stage 1 of moving towards a little bit of volatility,” said Matt Thompson of Little Harbor Advisors. “The VIX marketplace thinks the conflict is going to be contained.”<h2>Will the Fed change course?</h2>All eyes now turn to the US Federal Reserve, which is expected to keep its benchmark rate steady at 4.25–4.50 per cent when it concludes its policy meeting on Wednesday.&nbsp;However, market analysts including IG’s Tony Sycamore suggest the Iran–Israel war could prompt the Fed to consider an earlier-than-expected rate cut. “The situation in the Middle East could become a catalyst for the Fed to sound more dovish, as it did follow the October 7, 2023, Hamas attack,” Sycamore told Reuters.&nbsp;Lower rates generally boost oil demand by stimulating growth. But higher energy costs can also stoke inflation, complicating the Fed’s policy response.&nbsp;“Jerome Powell is going to continue to express that they are focused on data at this point,” said Matt Rubin of Cary Street Partners. “And that data does not warrant a cut.”<h2>Broader global impact</h2>The ripple effect is being felt across Europe too, where the STOXX 600 index closed at a three-week low on Tuesday. Investors are also bracing for interest rate decisions from the Bank of England and the Swiss National Bank later this week.&nbsp;In Asia, the Bank of Japan held rates steady at 0.5 per cent, its highest level since 2007, reflecting the growing uncertainty amid global inflation risks and weak domestic demand.&nbsp;Despite the conflict, Qatar said operations at the world’s largest gas field remain unaffected, even as Iran suspended some output after Israeli air strikes.&nbsp;The Iran–Israel war is redrawing the global economic map, with oil markets, central banks, and investors caught in its crosshairs.&nbsp;The longer it lasts, the deeper its impact on inflation, policy, and global growth.&nbsp;(With inputs from the agencies)

Amid rising tensions in the Middle East, oil spikes and Wall Street stumbles as investors brace for inflation risks, Fed moves, and global economic fallout.

Oil prices are rising sharply, and global markets are edging into risk-off mode as the Iran–Israel conflict shows no signs of slowing, entering its sixth day on Wednesday. The geopolitical crisis, centred near the Strait of Hormuz, is reviving fears of a global energy shock, even as central banks weigh the fallout on inflation and growth. Brent crude futures rose 19 cents to $76.64 a barrel in early trading, while US West Texas Intermediate climbed 23 cents to $75.07. That followed a 4 per cent spike in prices on Tuesday amid mounting concerns that the Middle East conflict could disrupt oil supplies. Strait of Hormuz back in focus Much of the market anxiety revolves around the Strait of Hormuz, the narrow chokepoint through which nearly 20 per cent of the world’s seaborne oil passes. According to Reuters, two tankers collided and caught fire near the strait on Tuesday, raising red flags about safety in the region. The United Kingdom Maritime Trade Operations also warned of “electronic interference” affecting ship navigation systems in the area, a possible sign of growing cyber-warfare threats tied to the conflict. Iran, the third-largest producer in OPEC, pumps around 3.3 million barrels per day. Should the fighting escalate, or sanctions intensify, traders expect disruptions to Iranian output though other OPEC members may struggle to compensate using spare capacity. Trump ups the ante On Tuesday, US President Donald Trump called for Iran’s “unconditional surrender” and sent additional fighter jets to the region, according to US officials quoted by Reuters. The US military buildup comes as part of an effort to deter further escalation, though markets fear it may have the opposite effect. Trump’s early departure from the Group of Seven summit in Canada only deepened investor unease. While there were hopes of progress on global trade talks, those evaporated as Trump returned to Washington citing Iran’s provocations. “The market was anxious to hopefully hear updates on trade agreements out of the G7 and the news of Trump leaving early was disappointing,” Eric Sterner of Apollon Wealth Management told Reuters. Wall Street wobbles The risk-off sentiment dragged down US stocks on Tuesday. The Dow Jones Industrial Average dropped 0.70 per cent, the S&P 500 slipped 0.84 per cent, and the tech-heavy Nasdaq fell 0.91 per cent. Meanwhile, oil continued its upward climb, with Brent settling 4.52 per cent higher at $76.54 per barrel and US crude jumping 4.46 per cent to close at $74.97. The conflict is also fuelling demand for safe-haven assets. Yields on 10-year US Treasuries fell to 4.389 per cent, down 6.5 basis points from Monday, a sign of growing investor caution. The VIX volatility index, often called Wall Street’s “fear gauge,” rose to a four-week high of 21.6, though still far below pandemic or financial crisis peaks. Analysts said the current spike reflects concern but not full-scale panic yet. “This is like Stage 1 of moving towards a little bit of volatility,” said Matt Thompson of Little Harbor Advisors. “The VIX marketplace thinks the conflict is going to be contained.” Will the Fed change course? All eyes now turn to the US Federal Reserve, which is expected to keep its benchmark rate steady at 4.25–4.50 per cent when it concludes its policy meeting on Wednesday. However, market analysts including IG’s Tony Sycamore suggest the Iran–Israel war could prompt the Fed to consider an earlier-than-expected rate cut. “The situation in the Middle East could become a catalyst for the Fed to sound more dovish, as it did follow the October 7, 2023, Hamas attack,” Sycamore told Reuters. Lower rates generally boost oil demand by stimulating growth. But higher energy costs can also stoke inflation, complicating the Fed’s policy response. “Jerome Powell is going to continue to express that they are focused on data at this point,” said Matt Rubin of Cary Street Partners. “And that data does not warrant a cut.” Broader global impact The ripple effect is being felt across Europe too, where the STOXX 600 index closed at a three-week low on Tuesday. Investors are also bracing for interest rate decisions from the Bank of England and the Swiss National Bank later this week. In Asia, the Bank of Japan held rates steady at 0.5 per cent, its highest level since 2007, reflecting the growing uncertainty amid global inflation risks and weak domestic demand. Despite the conflict, Qatar said operations at the world’s largest gas field remain unaffected, even as Iran suspended some output after Israeli air strikes. The Iran–Israel war is redrawing the global economic map, with oil markets, central banks, and investors caught in its crosshairs. The longer it lasts, the deeper its impact on inflation, policy, and global growth. (With inputs from the agencies)

Oil prices surge and markets slip as the Iran–Israel conflict escalates near the Strait of Hormuz, fuelling fears of a global energy shock.

Oil hits sixth-day high, Wall Street wobbles as Iran–Israel tensions escalate

Oil prices jumped sharply on Tuesday as fresh explosions rocked Tehran and tensions soared between Iran and Israel, fuelling fears of a wider regional conflict that could disrupt global energy supplies.&nbsp;Brent crude futures climbed $1.17, or 1.6 per cent, to $74.40 a barrel, while US West Texas Intermediate rose $1.34, or 1.87 per cent, to $73.11 in early trading, both having risen more than 2 per cent earlier in the session, as quoted by Reuters.&nbsp;The spike reverses Monday’s brief decline, when hopes of diplomatic de-escalation flickered after reports suggested Iran was open to ending hostilities. But those hopes evaporated overnight.<h2>Explosions in Tehran, missiles over Tel Aviv</h2>On the fifth day of the intensifying standoff, Iranian media reported explosions and heavy anti-aircraft fire in central Tehran. Air raid sirens also sounded in Tel Aviv as Israel responded to incoming Iranian missiles.&nbsp;The development comes after an Israeli strike hit Iran’s state broadcaster on Monday. Separately, the head of the UN’s nuclear watchdog confirmed significant damage to Iran’s largest uranium enrichment plant, raising fears of further retaliation.&nbsp;Iran is the third-largest oil producer in the Organisation of the Petroleum Exporting Countries (OPEC), and any military escalation could severely affect its crude output.<h2>Trump: ‘Evacuate everyone’ from Tehran</h2>Speaking to reporters on Monday night, US President Donald Trump said the situation was “extremely dangerous” and warned, “Everyone should evacuate Tehran immediately.” He added that Iran had missed a chance to strike a nuclear deal with Washington before hostilities began, but suggested Tehran may now be reconsidering.&nbsp;“If they had signed the deal, we wouldn’t be here,” Trump said. “But they didn’t. And now they want to.”&nbsp;Trump also hinted that easing US sanctions could still be on the table, potentially allowing Iran to ramp up oil exports. Such a scenario would normally put downward pressure on oil prices, but for now, traders are focused on immediate supply disruptions.<h2>OPEC+ sees slowing growth in US oil supply</h2>Meanwhile, OPEC and its allies, including Russia, collectively known as OPEC+, said on Monday they expect the global economy to remain “resilient” through the second half of 2025. However, the bloc trimmed its 2026 forecast for oil supply growth from non-OPEC+ producers such as the US and Brazil.&nbsp;The group, which accounts for nearly half the world’s oil output, is closely monitoring the Iran–Israel crisis for signs of a prolonged shock to Middle Eastern production flows.<h2>Market outlook: Volatility ahead</h2>Energy analysts warn that oil prices could rise sharply if fighting spreads or damages critical infrastructure in the Gulf. Iran controls key access points to the Strait of Hormuz, a chokepoint through which nearly one-fifth of global oil flows.&nbsp;“Any direct damage to Iranian oil facilities, or attempts to block the Strait, would be a red line for the global market,” said an analyst quoted by Reuters.&nbsp;With the US presidential election looming and the Middle East on edge, the oil market is once again at the mercy of geopolitics, setting the stage for more volatility in the weeks ahead.&nbsp;(With inputs from the agencies) &nbsp;

US President Donald Trump warned everyone to evacuate Tehran immediately and suggested Iran may reconsider signing a nuclear deal with Washington. 

Oil prices jumped sharply on Tuesday as fresh explosions rocked Tehran and tensions soared between Iran and Israel, fuelling fears of a wider regional conflict that could disrupt global energy supplies. Brent crude futures climbed $1.17, or 1.6 per cent, to $74.40 a barrel, while US West Texas Intermediate rose $1.34, or 1.87 per cent, to $73.11 in early trading, both having risen more than 2 per cent earlier in the session, as quoted by Reuters. The spike reverses Monday’s brief decline, when hopes of diplomatic de-escalation flickered after reports suggested Iran was open to ending hostilities. But those hopes evaporated overnight. Explosions in Tehran, missiles over Tel Aviv On the fifth day of the intensifying standoff, Iranian media reported explosions and heavy anti-aircraft fire in central Tehran. Air raid sirens also sounded in Tel Aviv as Israel responded to incoming Iranian missiles. The development comes after an Israeli strike hit Iran’s state broadcaster on Monday. Separately, the head of the UN’s nuclear watchdog confirmed significant damage to Iran’s largest uranium enrichment plant, raising fears of further retaliation. Iran is the third-largest oil producer in the Organisation of the Petroleum Exporting Countries (OPEC), and any military escalation could severely affect its crude output. Trump: ‘Evacuate everyone’ from Tehran Speaking to reporters on Monday night, US President Donald Trump said the situation was “extremely dangerous” and warned, “Everyone should evacuate Tehran immediately.” He added that Iran had missed a chance to strike a nuclear deal with Washington before hostilities began, but suggested Tehran may now be reconsidering. “If they had signed the deal, we wouldn’t be here,” Trump said. “But they didn’t. And now they want to.” Trump also hinted that easing US sanctions could still be on the table, potentially allowing Iran to ramp up oil exports. Such a scenario would normally put downward pressure on oil prices, but for now, traders are focused on immediate supply disruptions. OPEC+ sees slowing growth in US oil supply Meanwhile, OPEC and its allies, including Russia, collectively known as OPEC+, said on Monday they expect the global economy to remain “resilient” through the second half of 2025. However, the bloc trimmed its 2026 forecast for oil supply growth from non-OPEC+ producers such as the US and Brazil. The group, which accounts for nearly half the world’s oil output, is closely monitoring the Iran–Israel crisis for signs of a prolonged shock to Middle Eastern production flows. Market outlook: Volatility ahead Energy analysts warn that oil prices could rise sharply if fighting spreads or damages critical infrastructure in the Gulf. Iran controls key access points to the Strait of Hormuz, a chokepoint through which nearly one-fifth of global oil flows. “Any direct damage to Iranian oil facilities, or attempts to block the Strait, would be a red line for the global market,” said an analyst quoted by Reuters. With the US presidential election looming and the Middle East on edge, the oil market is once again at the mercy of geopolitics, setting the stage for more volatility in the weeks ahead. (With inputs from the agencies)

Oil prices surged on Tuesday due to fresh explosions in Tehran and increased tensions between Iran and Israel.&nbsp;

Oil prices climb amid Iran–Israel escalation, Trump issues evacuation warning

The Indian rupee is under considerable pressure as tensions in West Asia escalate, particularly with the ongoing Israel-Iran conflict. This has led to a surge in global crude oil prices, which are now trading above $83 per barrel. As India is a major oil importer, rising oil prices directly affect the rupee’s value and exacerbate inflation concerns.In early trade on June 16, the rupee fell 6 paise to 86.17 against the US dollar, reflecting the broader market’s reaction to the geopolitical turmoil. Analysts attribute the rupee’s decline to not just the rising oil prices but also to a strong US dollar and outflows from foreign institutional investors (FIIs).&nbsp;The geopolitical uncertainties, combined with the surge in oil prices, are putting further pressure on India’s currency, which had already been struggling due to global economic factors.<h2>Crude prices: A key factor for the rupee</h2>The sharp rise in crude oil prices, driven by escalating tensions in West Asia, has become a major concern for the Indian economy. Oil prices surged nearly 13 per cent in a short span, and this is having a direct impact on the Indian rupee, a currency that is particularly vulnerable to fluctuations in oil prices due to India’s reliance on crude imports.Kranthi Bathini, equity strategist at WealthMills Securities, told Moneycontrol that a sustained rise in oil prices could disrupt India’s inflation trajectory, which had recently been helped by a six-year low in consumer price inflation (CPI) at 2.8 per cent in May.&nbsp;A surge in oil prices could cause inflation to pick up again, forcing the Reserve Bank of India (RBI) to reassess its accommodative stance on interest rates. A more hawkish RBI stance could further weigh on the rupee, making it more expensive for importers and affecting India’s trade balance.<h2>Forex reserves provide some cushion</h2>Despite the rupee’s decline, there is some positive news. India’s foreign exchange reserves increased by $5.17 billion, reaching $696.65 billion for the week ending June 6.&nbsp;This rise in reserves provides a cushion for the rupee and could help the RBI manage the currency’s volatility in the short term. However, the overall outlook for the rupee remains cautious, with the geopolitical situation adding to the uncertainty.The RBI's ability to manage forex reserves effectively will be crucial if the tensions in the region persist and oil prices continue to rise. Analysts suggest that while the reserves offer some stability, India’s heavy dependence on oil imports means that any sustained spike in crude prices could be problematic for the rupee.<h2>Long-term outlook for the rupee and Indian markets</h2>Looking ahead, analysts remain cautiously optimistic about the rupee’s recovery in the medium term. Some expect the rupee to strengthen to 84 against the dollar by the October-December quarter, citing low domestic inflation and a manageable trade deficit. However, much of this outlook depends on how the geopolitical situation evolves and the movement of crude prices in the coming weeks.The current volatility in the rupee, triggered by the Israel-Iran conflict and the surge in oil prices, has led to a wait-and-watch approach from investors.&nbsp;Bathini told Moneycontrol that the market is adopting a cautious stance amid the uncertainty, with a particular focus on how crude prices will impact India’s inflation and economic growth. A sustained rise in oil prices could push inflation higher, forcing the RBI to adjust its policies.Despite the short-term challenges, Indian equities could offer opportunities for long-term investors if the rupee stabilises and geopolitical tensions subside.&nbsp;Some sectors, such as defence, infrastructure, and banking, are still seen as attractive due to their growth potential, regardless of the current market volatility. Bathini believes that any correction in the markets, triggered by the ongoing geopolitical risks, could present a good entry point for medium- to long-term investors.While the rupee faces pressure in the short term due to rising oil prices and geopolitical instability, the Indian economy’s fundamentals and forex reserves provide some resilience. Investors are advised to monitor the evolving geopolitical situation closely, as it will be key to determining the rupee’s trajectory in the coming months.

In early trade on June 16, the rupee fell 6 paise to 86.17 against the US dollar, reflecting the broader market’s reaction to the geopolitical turmoil.

The Indian rupee is under considerable pressure as tensions in West Asia escalate, particularly with the ongoing Israel-Iran conflict. This has led to a surge in global crude oil prices, which are now trading above $83 per barrel. As India is a major oil importer, rising oil prices directly affect the rupee’s value and exacerbate inflation concerns. In early trade on June 16, the rupee fell 6 paise to 86.17 against the US dollar, reflecting the broader market’s reaction to the geopolitical turmoil. Analysts attribute the rupee’s decline to not just the rising oil prices but also to a strong US dollar and outflows from foreign institutional investors (FIIs). The geopolitical uncertainties, combined with the surge in oil prices, are putting further pressure on India’s currency, which had already been struggling due to global economic factors. Crude prices: A key factor for the rupee The sharp rise in crude oil prices, driven by escalating tensions in West Asia, has become a major concern for the Indian economy. Oil prices surged nearly 13 per cent in a short span, and this is having a direct impact on the Indian rupee, a currency that is particularly vulnerable to fluctuations in oil prices due to India’s reliance on crude imports. Kranthi Bathini, equity strategist at WealthMills Securities, told Moneycontrol that a sustained rise in oil prices could disrupt India’s inflation trajectory, which had recently been helped by a six-year low in consumer price inflation (CPI) at 2.8 per cent in May. A surge in oil prices could cause inflation to pick up again, forcing the Reserve Bank of India (RBI) to reassess its accommodative stance on interest rates. A more hawkish RBI stance could further weigh on the rupee, making it more expensive for importers and affecting India’s trade balance. Forex reserves provide some cushion Despite the rupee’s decline, there is some positive news. India’s foreign exchange reserves increased by $5.17 billion, reaching $696.65 billion for the week ending June 6. This rise in reserves provides a cushion for the rupee and could help the RBI manage the currency’s volatility in the short term. However, the overall outlook for the rupee remains cautious, with the geopolitical situation adding to the uncertainty. The RBI's ability to manage forex reserves effectively will be crucial if the tensions in the region persist and oil prices continue to rise. Analysts suggest that while the reserves offer some stability, India’s heavy dependence on oil imports means that any sustained spike in crude prices could be problematic for the rupee. Long-term outlook for the rupee and Indian markets Looking ahead, analysts remain cautiously optimistic about the rupee’s recovery in the medium term. Some expect the rupee to strengthen to 84 against the dollar by the October-December quarter, citing low domestic inflation and a manageable trade deficit. However, much of this outlook depends on how the geopolitical situation evolves and the movement of crude prices in the coming weeks. The current volatility in the rupee, triggered by the Israel-Iran conflict and the surge in oil prices, has led to a wait-and-watch approach from investors. Bathini told Moneycontrol that the market is adopting a cautious stance amid the uncertainty, with a particular focus on how crude prices will impact India’s inflation and economic growth. A sustained rise in oil prices could push inflation higher, forcing the RBI to adjust its policies. Despite the short-term challenges, Indian equities could offer opportunities for long-term investors if the rupee stabilises and geopolitical tensions subside. Some sectors, such as defence, infrastructure, and banking, are still seen as attractive due to their growth potential, regardless of the current market volatility. Bathini believes that any correction in the markets, triggered by the ongoing geopolitical risks, could present a good entry point for medium- to long-term investors. While the rupee faces pressure in the short term due to rising oil prices and geopolitical instability, the Indian economy’s fundamentals and forex reserves provide some resilience. Investors are advised to monitor the evolving geopolitical situation closely, as it will be key to determining the rupee’s trajectory in the coming months.

In early trade on June 16, the rupee fell 6 paise to 86.17 against the US dollar, reflecting the broader market’s reaction to the geopolitical turmoil.

Rupee faces pressure amid rising oil prices and geopolitical tensions

As tensions between Israel and Iran escalate into direct military confrontation, shockwaves are rippling through global markets, threatening to unleash a fresh wave of inflation and derail fragile economic recoveries.&nbsp;Gold prices soared, oil surged, and investors fled to the safety of the US dollar on Friday after Israel launched strikes on Iranian military assets. The economic tremors are already visible, with energy markets, shipping, consumer goods, and travel sectors bracing for renewed volatility.<h2>Oil spikes, gas prices may follow</h2>Crude prices posted their largest one-day surge since Russia’s invasion of Ukraine in 2022. Brent crude jumped over 9 per cent, crossing $94 per barrel, while WTI crude hovered above $91, as per Reuters.&nbsp;The market is now pricing in a worst-case scenario—an Iranian attempt to blockade the Strait of Hormuz, which handles about 20 million barrels per day, or roughly 20 per cent of global oil flows, according to the US Energy Information Administration (EIA).&nbsp;As quoted by ING and Bloomberg, the Israel–Iran conflict could wipe out a projected Q3–Q4 2025 oil surplus, pushing prices further up. JPMorgan analysts, quoted by Reuters, warned crude could surge to $120–130 per barrel if supplies from the Gulf are disrupted.&nbsp;In the US, average gas prices were $3.13 per gallon on Friday, down from $3.46 a year ago, according to AAA. But that decline could reverse quickly. In India, fuel prices are closely tied to Brent benchmarks, and as per Nomura, a sustained surge could result in a ₹4–5/litre hike in petrol and diesel prices.<h2>Shipping squeezed again: Red Sea risk rises</h2>The Red Sea which is already under stress from Houthi rebel attacks will now faces heightened risk amid Iran-backed militant threats to commercial vessels. Shipping traffic in the region has fallen by nearly 25 per cent since January, according to Lloyd’s List Intelligence, as carriers avoid the high-risk corridor.&nbsp;US-led airstrikes in Yemen have forced global cargo carriers to reroute vessels around the Cape of Good Hope, adding 10–14 days to Asia–Europe voyages and sharply increasing insurance and fuel costs, as reported by Bloomberg.&nbsp;The Baltic Dry Index, a global benchmark for shipping activity, rose to 1,904, it's highest in eight months—as per Trading Economics. Shipping stocks also surged: Teekay Corp and Frontline Ltd gained 6–7 per cent, according to Bloomberg data.<h2>Consumer goods: A perfect storm of tariffs and tensions</h2>With US President Donald Trump’s 2025 tariffs imposing new levies on imports from China, Vietnam, and India, retailers are already under pressure. The US Retail Federation, as quoted by Reuters, estimates that these tariffs are adding 5–12 per cent to wholesale costs across product categories.&nbsp;&nbsp;The Israel–Iran conflict is expected to amplify these pressures. Logistics and energy costs are rising, and companies like Walmart and J.M. Smucker have already passed those hikes onto consumers, as noted by Reuters.&nbsp;As per ING analysts quoted by the Associated Press, firms are burning through their inventory buffers, and the resulting supply crunch could cause “larger month-on-month inflation spikes” in mid-2025. Central banks that were celebrating a soft landing may now be forced into a new inflation&nbsp;battle.<h2>Travel turmoil: Flights down, costs uncertain</h2>Jet fuel prices are climbing fast, and airlines are adjusting. As per FlightRadar24, over 100 commercial flights have been cancelled or rerouted since the start of the week, with airspace over Iran, Iraq, and parts of the Gulf becoming increasingly restricted.&nbsp;Major airlines including Lufthansa, Emirates, and Air India have announced temporary flight suspensions or altered long-haul routes to avoid the region, according to Reuters. These detours raise fuel burn and operating costs significantly.&nbsp;The S&amp;P 500 Airline Index dropped 1.6 per cent on Friday, with shares of Delta Air Lines and United Airlines falling 2–3 per cent, as reported by Bloomberg. Analysts expect operational costs to rise further as hedging becomes more expensive.&nbsp;Despite that, leisure demand is softening. Bank of America card data, cited by Reuters, shows a 4.2 per cent dip in consumer travel spending over the past month. Combined with the Boeing aircraft safety concerns and rising geopolitical anxiety, passenger confidence remains fragile.<h2>Federal Reserve under pressure</h2>The economic fallout from a deeper Israel–Iran war could derail the global effort to tame inflation. The US Federal Reserve, which meets next week, was expected to hold rates steady, but may now revise its inflation outlook.&nbsp;As quoted by the Associated Press, ING said price hikes “already in the pipeline” could be accelerated by conflict-driven supply shocks. The Fed’s Beige Book, released last week, flagged “widespread reports” of upcoming consumer price increases—particularly in sectors exposed to energy and logistics&nbsp;volatility.<h2>The big picture: Geo-shock meets fragile recovery</h2>The Israel–Iran conflict comes at a precarious time. With global inflation only recently stabilising, another commodity and supply chain shock could push households and businesses into a new wave of economic pain.&nbsp;For now, diplomacy appears stalled. Until de-escalation materialises, global markets and policymakers face another long, uncertain summer marked by higher prices, tighter credit, and deeper strategic risk.&nbsp;&nbsp;(With inputs from the agencies)&nbsp;

The economic fallout from a deeper Israel–Iran war could derail the global effort to tame inflation. The US Federal Reserve, which meets next week, was expected to hold rates steady, but may now revise its inflation outlook.

As tensions between Israel and Iran escalate into direct military confrontation, shockwaves are rippling through global markets, threatening to unleash a fresh wave of inflation and derail fragile economic recoveries. Gold prices soared, oil surged, and investors fled to the safety of the US dollar on Friday after Israel launched strikes on Iranian military assets. The economic tremors are already visible, with energy markets, shipping, consumer goods, and travel sectors bracing for renewed volatility. Oil spikes, gas prices may follow Crude prices posted their largest one-day surge since Russia’s invasion of Ukraine in 2022. Brent crude jumped over 9 per cent, crossing $94 per barrel, while WTI crude hovered above $91, as per Reuters. The market is now pricing in a worst-case scenario—an Iranian attempt to blockade the Strait of Hormuz, which handles about 20 million barrels per day, or roughly 20 per cent of global oil flows, according to the US Energy Information Administration (EIA). As quoted by ING and Bloomberg, the Israel–Iran conflict could wipe out a projected Q3–Q4 2025 oil surplus, pushing prices further up. JPMorgan analysts, quoted by Reuters, warned crude could surge to $120–130 per barrel if supplies from the Gulf are disrupted. In the US, average gas prices were $3.13 per gallon on Friday, down from $3.46 a year ago, according to AAA. But that decline could reverse quickly. In India, fuel prices are closely tied to Brent benchmarks, and as per Nomura, a sustained surge could result in a ₹4–5/litre hike in petrol and diesel prices. Shipping squeezed again: Red Sea risk rises The Red Sea which is already under stress from Houthi rebel attacks will now faces heightened risk amid Iran-backed militant threats to commercial vessels. Shipping traffic in the region has fallen by nearly 25 per cent since January, according to Lloyd’s List Intelligence, as carriers avoid the high-risk corridor. US-led airstrikes in Yemen have forced global cargo carriers to reroute vessels around the Cape of Good Hope, adding 10–14 days to Asia–Europe voyages and sharply increasing insurance and fuel costs, as reported by Bloomberg. The Baltic Dry Index, a global benchmark for shipping activity, rose to 1,904, it's highest in eight months—as per Trading Economics. Shipping stocks also surged: Teekay Corp and Frontline Ltd gained 6–7 per cent, according to Bloomberg data. Consumer goods: A perfect storm of tariffs and tensions With US President Donald Trump’s 2025 tariffs imposing new levies on imports from China, Vietnam, and India, retailers are already under pressure. The US Retail Federation, as quoted by Reuters, estimates that these tariffs are adding 5–12 per cent to wholesale costs across product categories. The Israel–Iran conflict is expected to amplify these pressures. Logistics and energy costs are rising, and companies like Walmart and J.M. Smucker have already passed those hikes onto consumers, as noted by Reuters. As per ING analysts quoted by the Associated Press, firms are burning through their inventory buffers, and the resulting supply crunch could cause “larger month-on-month inflation spikes” in mid-2025. Central banks that were celebrating a soft landing may now be forced into a new inflation battle. Travel turmoil: Flights down, costs uncertain Jet fuel prices are climbing fast, and airlines are adjusting. As per FlightRadar24, over 100 commercial flights have been cancelled or rerouted since the start of the week, with airspace over Iran, Iraq, and parts of the Gulf becoming increasingly restricted. Major airlines including Lufthansa, Emirates, and Air India have announced temporary flight suspensions or altered long-haul routes to avoid the region, according to Reuters. These detours raise fuel burn and operating costs significantly. The S&P 500 Airline Index dropped 1.6 per cent on Friday, with shares of Delta Air Lines and United Airlines falling 2–3 per cent, as reported by Bloomberg. Analysts expect operational costs to rise further as hedging becomes more expensive. Despite that, leisure demand is softening. Bank of America card data, cited by Reuters, shows a 4.2 per cent dip in consumer travel spending over the past month. Combined with the Boeing aircraft safety concerns and rising geopolitical anxiety, passenger confidence remains fragile. Federal Reserve under pressure The economic fallout from a deeper Israel–Iran war could derail the global effort to tame inflation. The US Federal Reserve, which meets next week, was expected to hold rates steady, but may now revise its inflation outlook. As quoted by the Associated Press, ING said price hikes “already in the pipeline” could be accelerated by conflict-driven supply shocks. The Fed’s Beige Book, released last week, flagged “widespread reports” of upcoming consumer price increases—particularly in sectors exposed to energy and logistics volatility. The big picture: Geo-shock meets fragile recovery The Israel–Iran conflict comes at a precarious time. With global inflation only recently stabilising, another commodity and supply chain shock could push households and businesses into a new wave of economic pain. For now, diplomacy appears stalled. Until de-escalation materialises, global markets and policymakers face another long, uncertain summer marked by higher prices, tighter credit, and deeper strategic risk. (With inputs from the agencies)

The Israel–Iran conflict is rattling global markets, triggering oil and gold surges, inflation fears, and fresh pressure on supply chains, travel, and central banks.

Israel–Iran war may send prices soaring, fuel global economic turmoil

Oil prices soared on Friday, posting their sharpest gains in over a year, as escalating tensions between Israel and Iran spooked energy markets. Brent crude settled at $74.23 a barrel, up 7.02 per cent or $4.87, while US West Texas Intermediate (WTI) closed at $72.98, a jump of 7.62 per cent or $4.94, according to data quoted by Reuters.&nbsp;Both benchmarks hit their highest intraday levels since January, with Brent touching $78.50 and WTI surging to $77.62 earlier in the session.&nbsp;&nbsp;Week-on-week, Brent was up 12.5 per cent and WTI climbed nearly 13 per cent—marking the most dramatic one-day swings since 2022, when Russia invaded Ukraine and sent energy markets into a frenzy.&nbsp;The gains come amid heightened geopolitical risks in the Middle East—home to a third of the world’s oil supply—raising investor concerns over potential disruptions to oil flows, particularly through the Strait of Hormuz.<h2>Markets retreat, safe havens surge</h2>The global equity markets recoiled under pressure. As per Reuters, the Dow Jones Industrial Average slipped by 1.8 per cent, the S&amp;P 500 fell over 1 per cent, and the Nasdaq dropped 1.3 per cent. Investors sought safety in gold, the US dollar, and the Swiss franc, driving those assets higher in a classic flight to safety.&nbsp;Meanwhile, speculative interest in crude oil surged. According to the US Commodity Futures Trading Commission (CFTC), money managers raised their net long positions in US crude futures and options by over 15,000 contracts in the week ending June 10, reaching a total of 121,911 positions.&nbsp;&nbsp;Traders also aggressively bought WTI $80 call options, signalling expectations of further price increases, as reported by Bloomberg.&nbsp;Adding to the pressure, energy services firm Baker Hughes reported that the US oil rig count fell for the seventh straight week. The number of active oil rigs dropped by three to 439—the lowest since October 2021.<h2>Israel–Iran conflict escalates with cross-border strikes</h2>The oil rally was fuelled by a dramatic escalation in military action between Israel and Iran. On Friday, Israel confirmed that it had launched targeted air strikes on Iranian nuclear research facilities, missile production sites, and senior military personnel.&nbsp;&nbsp;As quoted by Reuters, the Israeli Defence Forces warned that this was the beginning of a “prolonged campaign” to halt Tehran’s nuclear ambitions.&nbsp;In retaliation, Iran launched more than 150 ballistic missiles and over 100 drones targeting Israeli cities, including Tel Aviv and Jerusalem. While most were intercepted, several missiles struck buildings, injuring dozens, as per updates from The Guardian.&nbsp;Despite the exchange, Iran’s oil infrastructure—including the Kharg Island terminal responsible for 90 per cent of its crude exports—remains untouched. “Israeli action has so far avoided Iranian energy infrastructure,” said Ben Hoff, head of commodity research at Societe Generale, in a note cited by Reuters.&nbsp;But analysts warn that this restraint may not last. “Any further escalation could follow an ‘energy-for-energy’ logic,” Hoff added, suggesting that an attack on one side’s oil infrastructure could provoke retaliatory strikes on the others.&nbsp;Iran, a founding member of the Organization of the Petroleum Exporting Countries (OPEC), currently produces around 3.3 million barrels of oil per day and exports over 2 million barrels of crude and refined fuels daily, as per estimates cited by Reuters.&nbsp;&nbsp;A disruption in its output would significantly affect global supply dynamics, especially with limited spare capacity available within OPEC+.<h2>Strait of Hormuz in focus</h2>The biggest wildcard remains the Strait of Hormuz, through which an estimated 18 to 19 million barrels of oil and fuel pass daily, roughly a fifth of global consumption. According to Rabobank, “Saudi Arabia, Kuwait, Iraq and Iran are wholly locked into one tiny passage for exports,” making any disruption a global economic threat.&nbsp;Iran has so far refrained from threatening the strait, aware that its own sea-based oil exports—primarily to China—would be crippled. “Cutting off the Strait of Hormuz would be counterproductive to Iran’s relationship with its sole oil customer, China,” said analysts at JP Morgan, as quoted by Reuters.&nbsp;Still, energy analysts are not ruling out further volatility. Goldman Sachs warned that crude prices could spike above $100 a barrel if the situation worsens, while JP Morgan has flagged a scenario where Brent hits $120 if the conflict spreads to key infrastructure or leads to prolonged shipping disruptions.<h2>Emergency response readiness</h2>In response to the turmoil, the International Energy Agency (IEA) announced on Friday that it is prepared to release strategic reserves should the situation result in significant supply disruptions. However, as quoted by Reuters, OPEC and its allies currently see no need to raise production, suggesting confidence that market fundamentals remain stable for now.&nbsp;While no physical supply has been disrupted yet, the reintroduction of a geopolitical risk premium is now firmly priced into oil markets.&nbsp;&nbsp;With tensions running high, the energy world is bracing for further volatility in the coming days. All eyes are on the next moves by Tehran and Tel Aviv—and whether this oil price spike is a warning or the beginning of a longer crisis. &nbsp;(With inputs from the agencies)&nbsp;

Soaring crude prices, driven by Israel–Iran military escalation, have revived geopolitical risk premiums and raised concerns over oil flow disruptions through the Strait of Hormuz.

Oil prices soared on Friday, posting their sharpest gains in over a year, as escalating tensions between Israel and Iran spooked energy markets. Brent crude settled at $74.23 a barrel, up 7.02 per cent or $4.87, while US West Texas Intermediate (WTI) closed at $72.98, a jump of 7.62 per cent or $4.94, according to data quoted by Reuters. Both benchmarks hit their highest intraday levels since January, with Brent touching $78.50 and WTI surging to $77.62 earlier in the session. Week-on-week, Brent was up 12.5 per cent and WTI climbed nearly 13 per cent—marking the most dramatic one-day swings since 2022, when Russia invaded Ukraine and sent energy markets into a frenzy. The gains come amid heightened geopolitical risks in the Middle East—home to a third of the world’s oil supply—raising investor concerns over potential disruptions to oil flows, particularly through the Strait of Hormuz. Markets retreat, safe havens surge The global equity markets recoiled under pressure. As per Reuters, the Dow Jones Industrial Average slipped by 1.8 per cent, the S&P 500 fell over 1 per cent, and the Nasdaq dropped 1.3 per cent. Investors sought safety in gold, the US dollar, and the Swiss franc, driving those assets higher in a classic flight to safety. Meanwhile, speculative interest in crude oil surged. According to the US Commodity Futures Trading Commission (CFTC), money managers raised their net long positions in US crude futures and options by over 15,000 contracts in the week ending June 10, reaching a total of 121,911 positions. Traders also aggressively bought WTI $80 call options, signalling expectations of further price increases, as reported by Bloomberg. Adding to the pressure, energy services firm Baker Hughes reported that the US oil rig count fell for the seventh straight week. The number of active oil rigs dropped by three to 439—the lowest since October 2021. Israel–Iran conflict escalates with cross-border strikes The oil rally was fuelled by a dramatic escalation in military action between Israel and Iran. On Friday, Israel confirmed that it had launched targeted air strikes on Iranian nuclear research facilities, missile production sites, and senior military personnel. As quoted by Reuters, the Israeli Defence Forces warned that this was the beginning of a “prolonged campaign” to halt Tehran’s nuclear ambitions. In retaliation, Iran launched more than 150 ballistic missiles and over 100 drones targeting Israeli cities, including Tel Aviv and Jerusalem. While most were intercepted, several missiles struck buildings, injuring dozens, as per updates from The Guardian. Despite the exchange, Iran’s oil infrastructure—including the Kharg Island terminal responsible for 90 per cent of its crude exports—remains untouched. “Israeli action has so far avoided Iranian energy infrastructure,” said Ben Hoff, head of commodity research at Societe Generale, in a note cited by Reuters. But analysts warn that this restraint may not last. “Any further escalation could follow an ‘energy-for-energy’ logic,” Hoff added, suggesting that an attack on one side’s oil infrastructure could provoke retaliatory strikes on the others. Iran, a founding member of the Organization of the Petroleum Exporting Countries (OPEC), currently produces around 3.3 million barrels of oil per day and exports over 2 million barrels of crude and refined fuels daily, as per estimates cited by Reuters. A disruption in its output would significantly affect global supply dynamics, especially with limited spare capacity available within OPEC+. Strait of Hormuz in focus The biggest wildcard remains the Strait of Hormuz, through which an estimated 18 to 19 million barrels of oil and fuel pass daily, roughly a fifth of global consumption. According to Rabobank, “Saudi Arabia, Kuwait, Iraq and Iran are wholly locked into one tiny passage for exports,” making any disruption a global economic threat. Iran has so far refrained from threatening the strait, aware that its own sea-based oil exports—primarily to China—would be crippled. “Cutting off the Strait of Hormuz would be counterproductive to Iran’s relationship with its sole oil customer, China,” said analysts at JP Morgan, as quoted by Reuters. Still, energy analysts are not ruling out further volatility. Goldman Sachs warned that crude prices could spike above $100 a barrel if the situation worsens, while JP Morgan has flagged a scenario where Brent hits $120 if the conflict spreads to key infrastructure or leads to prolonged shipping disruptions. Emergency response readiness In response to the turmoil, the International Energy Agency (IEA) announced on Friday that it is prepared to release strategic reserves should the situation result in significant supply disruptions. However, as quoted by Reuters, OPEC and its allies currently see no need to raise production, suggesting confidence that market fundamentals remain stable for now. While no physical supply has been disrupted yet, the reintroduction of a geopolitical risk premium is now firmly priced into oil markets. With tensions running high, the energy world is bracing for further volatility in the coming days. All eyes are on the next moves by Tehran and Tel Aviv—and whether this oil price spike is a warning or the beginning of a longer crisis. (With inputs from the agencies)

Oil prices jumped over 7% amid escalating Israel–Iran tensions, fuelling market fears of potential supply disruptions in the Middle East.

Oil prices surge over 7% as Israel–Iran conflict reignites Middle East fears

Oil prices jumped more than 12% on Friday (June 13) following news that Israel had carried out strikes on Iran. The development raised concerns over a broader conflict in the Middle East region, potentially disrupting global oil supplies.&nbsp;West Texas Intermediate, the main US oil contract, soared 12.6 percent to $76.61 per barrel, while Brent North Sea crude jumped 12.2 percent at $77.77.&nbsp;Both major oil benchmarks surged over 12%—touching highs not seen since January—amid escalating fears of supply disruptions following Israeli strikes on Iran. The latest spike builds on gains earlier in the week as geopolitical tensions intensified.&nbsp;The shockwaves rippled across global markets. Asian stocks plunged, U.S. and European equity futures fell sharply, and investors rushed into safe havens. Gold soared past $3,400 an ounce, and bond markets rallied as yields dropped.&nbsp;"The Middle East powder keg just blew the lid off global markets," said Stephen Innes of SPI Asset Management to AFP. “Equity futures are plummeting. Bond yields are sinking. Gold and oil are skyrocketing.”&nbsp;Brent crude is rapidly approaching the mid-$70s, Innes noted, adding that a direct hit to the Strait of Hormuz—which handles about 20% of global oil flows—could add another $15 to the price.&nbsp;“If Iran exercises restraint, markets may bounce back. But if Tel Aviv is hit or Tehran responds aggressively, we could be looking at a scenario that reshapes the global economic outlook for the rest of 2025,” he warned.&nbsp;Earlier this week, JPMorgan Chase had cautioned that crude prices could surpass $130 a barrel if the conflict spirals into a worst-case scenario.&nbsp;Israeli Prime Minister Benjamin Netanyahu said in a video statement: "This operation will continue for as many days as it takes to remove this threat.&nbsp;"We struck at the heart of Iran's nuclear enrichment programme. We targeted Iran's main enrichment facility at Natanz. We also struck at the heart of Iran's ballistic missile programme," he added.

Oil prices jump to two-month high as tensions escalate in Middle East

Oil prices jumped more than 12% on Friday (June 13) following news that Israel had carried out strikes on Iran. The development raised concerns over a broader conflict in the Middle East region, potentially disrupting global oil supplies. West Texas Intermediate, the main US oil contract, soared 12.6 percent to $76.61 per barrel, while Brent North Sea crude jumped 12.2 percent at $77.77. Both major oil benchmarks surged over 12%—touching highs not seen since January—amid escalating fears of supply disruptions following Israeli strikes on Iran. The latest spike builds on gains earlier in the week as geopolitical tensions intensified. The shockwaves rippled across global markets. Asian stocks plunged, U.S. and European equity futures fell sharply, and investors rushed into safe havens. Gold soared past $3,400 an ounce, and bond markets rallied as yields dropped. "The Middle East powder keg just blew the lid off global markets," said Stephen Innes of SPI Asset Management to AFP. “Equity futures are plummeting. Bond yields are sinking. Gold and oil are skyrocketing.” Brent crude is rapidly approaching the mid-$70s, Innes noted, adding that a direct hit to the Strait of Hormuz—which handles about 20% of global oil flows—could add another $15 to the price. “If Iran exercises restraint, markets may bounce back. But if Tel Aviv is hit or Tehran responds aggressively, we could be looking at a scenario that reshapes the global economic outlook for the rest of 2025,” he warned. Earlier this week, JPMorgan Chase had cautioned that crude prices could surpass $130 a barrel if the conflict spirals into a worst-case scenario. Israeli Prime Minister Benjamin Netanyahu said in a video statement: "This operation will continue for as many days as it takes to remove this threat. "We struck at the heart of Iran's nuclear enrichment programme. We targeted Iran's main enrichment facility at Natanz. We also struck at the heart of Iran's ballistic missile programme," he added.

Oil prices surged following Israel's strikes on Iranian military and nuclear sites, rising fears of a conflict in the Middle East region

As US President Donald Trump&rsquo;s administration seeks ways to manage rising inflation, oil prices have emerged as a key focus.&nbsp;<o:p></o:p>
Experts say that some of Trump&rsquo;s advisers now see controlling oil prices as an essential anti-inflation strategy, an effort to reduce inflationary pressures, particularly on consumer goods, where transportation costs play a significant role. <o:p></o:p>
<h2>Trump&rsquo;s oil strategy: A temporary fix?</h2>
Lower oil prices, they argue, could help offset the impact of other inflation-driving policies, such as tariffs. However, this approach is not without its contradictions. Trump has long promoted increasing US fossil fuel output to reduce reliance on OPEC and assert greater geopolitical control.&nbsp; But experts caution that efforts to lower oil prices may alienate vital oil-producing allies, especially Saudi Arabia.&nbsp;Moreover, domestic shale producers, facing an uncertain future due to fluctuating oil price expectations, have already scaled back investments, creating a dilemma for the administration.&nbsp; The Dallas Federal Reserve&rsquo;s recent survey highlighted that shale firms are hesitant to increase production, fearing the potential of sub-$50 oil prices.&nbsp;Global geopolitical tensions add another layer of complexity. Instability in West Asia&mdash;exemplified by recent attacks and rising tariffs&mdash;can lead to unpredictable surges in oil prices, complicating trump&rsquo;s plans to manage inflation via lower energy costs. Critics argue that while lower oil prices may provide temporary relief for consumers, the broader inflation problem requires more than just fossil fuel policies. <o:p></o:p>
&nbsp;
(With inputs from the agencies)<o:p></o:p>

Business & Economy: As US President Donald Trump’s administration seeks ways to manage rising inflation, oil prices have emerged as a key focus.

As US President Donald Trump’s administration seeks ways to manage rising inflation, oil prices have emerged as a key focus. Experts say that some of Trump’s advisers now see controlling oil prices as an essential anti-inflation strategy, an effort to reduce inflationary pressures, particularly on consumer goods, where transportation costs play a significant role. Trump’s oil strategy: A temporary fix? Lower oil prices, they argue, could help offset the impact of other inflation-driving policies, such as tariffs. However, this approach is not without its contradictions. Trump has long promoted increasing US fossil fuel output to reduce reliance on OPEC and assert greater geopolitical control. But experts caution that efforts to lower oil prices may alienate vital oil-producing allies, especially Saudi Arabia. Moreover, domestic shale producers, facing an uncertain future due to fluctuating oil price expectations, have already scaled back investments, creating a dilemma for the administration. The Dallas Federal Reserve’s recent survey highlighted that shale firms are hesitant to increase production, fearing the potential of sub-$50 oil prices. Global geopolitical tensions add another layer of complexity. Instability in West Asia—exemplified by recent attacks and rising tariffs—can lead to unpredictable surges in oil prices, complicating trump’s plans to manage inflation via lower energy costs. Critics argue that while lower oil prices may provide temporary relief for consumers, the broader inflation problem requires more than just fossil fuel policies. (With inputs from the agencies)

Trump’s push for cheap oil faces roadblocks

Saudi Arabia's Aramco cut oil prices for Asian importers for December, this comes after a statement by OPEC + members to delay output increases by one month.

Aramco Cuts Oil Prices to Asia for December After OPEC + Delay

Eight members of the OPEC+ group of oil-producing nations said on Sunday they were extending supply cuts until the end of December.

The move is aimed at boosting oil prices amid uncertain demand and accelerating supply, with an eye on the imminent US presidential election, though analysts predict a limited impact.

The eight countries "have agreed to extend the November 2023 voluntary production adjustments of 2.2 million barrels per day for one month until the end of December 2024," the Vienna-based Organization of the Petroleum Exporting Countries said in a statement.

The eight from the 22-member group extending the cuts are leaders Saudi Arabia and Russia, as well as Algeria, Iraq, Kazakhstan, Kuwait, Oman and the United Arab Emirates.

They have been delaying production increases amid concerns over slowing demand, which has weighed on oil prices in recent months.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said the announcement was "the logical next step of the persistent downside pressure on oil prices due to sluggish Chinese and weakening global demand outlook and ample non-OPEC supply".

But any boost to oil prices would "unlikely" last unless OPEC+ "takes further measures to restrict production", Ozkardeskaya told AFP.

And even then, "their restriction strategy hasn't led to a sustainable rise of oil prices," she said, adding the grouping now accounted for less than half of the global oil output.

Jorge Leon, an analyst with Rystad Energy, said OPEC+ was awaiting the results of the November 5 US presidential election, which "will have a significant impact on the oil market".

"I am not so sure who would Opec prefer, but a trade war would mean lower demand," Leon told AFP, adding a trade war was "likely" if Republican Donald Trump wins.

OPEC+ ministers are due to meet in early December in Vienna at the group's headquarters, but with Sunday's announcement, the eight countries have already decided not to reopen the taps until at least early 2025.

During the last ministerial meeting in June, OPEC+ had still announced they wanted to increase their production from October, though it has stressed that this decision could be reviewed at any time.

Disclaimer: This story has been published from a news agency feed with minimal edits to adhere to WION's style guide. The headline may have been changed to better reflect the content of the story or to make it more suitable for WION&nbsp;audience. 
&nbsp;

Eight members of the OPEC+ group of oil-producing nations said on Sunday they were extending supply cuts until the end of December. The move is aimed at boosting oil prices amid uncertain demand and accelerating supply, with an eye on the imminent US presidential election, though analysts predict a limited impact.

Eight members of the OPEC+ group of oil-producing nations said on Sunday they were extending supply cuts until the end of December. The move is aimed at boosting oil prices amid uncertain demand and accelerating supply, with an eye on the imminent US presidential election, though analysts predict a limited impact. The eight countries "have agreed to extend the November 2023 voluntary production adjustments of 2.2 million barrels per day for one month until the end of December 2024," the Vienna-based Organization of the Petroleum Exporting Countries said in a statement. The eight from the 22-member group extending the cuts are leaders Saudi Arabia and Russia, as well as Algeria, Iraq, Kazakhstan, Kuwait, Oman and the United Arab Emirates. They have been delaying production increases amid concerns over slowing demand, which has weighed on oil prices in recent months. Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said the announcement was "the logical next step of the persistent downside pressure on oil prices due to sluggish Chinese and weakening global demand outlook and ample non-OPEC supply". But any boost to oil prices would "unlikely" last unless OPEC+ "takes further measures to restrict production", Ozkardeskaya told AFP. And even then, "their restriction strategy hasn't led to a sustainable rise of oil prices," she said, adding the grouping now accounted for less than half of the global oil output. Jorge Leon, an analyst with Rystad Energy, said OPEC+ was awaiting the results of the November 5 US presidential election, which "will have a significant impact on the oil market". "I am not so sure who would Opec prefer, but a trade war would mean lower demand," Leon told AFP, adding a trade war was "likely" if Republican Donald Trump wins. OPEC+ ministers are due to meet in early December in Vienna at the group's headquarters, but with Sunday's announcement, the eight countries have already decided not to reopen the taps until at least early 2025. During the last ministerial meeting in June, OPEC+ had still announced they wanted to increase their production from October, though it has stressed that this decision could be reviewed at any time. Disclaimer: This story has been published from a news agency feed with minimal edits to adhere to WION's style guide. The headline may have been changed to better reflect the content of the story or to make it more suitable for WION audience.

OPEC+ extends oil supply cuts until December to boost prices amid global demand concerns

Iraq, once a major importer of wheat, is now facing a surplus of 1.5 million metric tons. This unexpected abundance is a result of favourable weather conditions and generous government subsidies. Watch in for more details!

Iraq's Wheat Surplus Poses Major Challenge Amid Falling Oil Prices

Crude oil rose for a third day as traders reassessed supply risks in the Middle East, where Israel is seen as likely to make a retaliatory strike against Iran after Tehran's missile attack this week.

Brent crude moved toward $75 a barrel after an almost 3 per cent gain in the previous two sessions. Meanwhile, West Texas Intermediate stagnated near $71. Israel threatened Iran with reprisals, although US President Joe Biden has called upon the country to hold off from targeting its nuclear sites.

The oil market remains captivated by the stalemate in the Middle East, &nbsp;which comes after a year of unrest as Israel faces off against Iran and its proxies in Gaza, Lebanon, Yemen, and other areas. The region is responsible for about a third of global supply, and traders are worried that the latest escalation could disrupt flows if energy facilities come under attack or supply routes are obstructed.

Citigroup Inc. says a major strike by Israel on Iran's oil-exporting capacity may eliminate 1.5 million barrels of supply that is supplied into the market every day. According to analysts including Francesco Martoccia in a note, if the smaller infrastructure on target meant targeting these downstream assets and the storage facilities, output disruption would be between 300,000 and 450,000 barrels.

The recent price increases have pushed a gauge of Brent's implied volatility to its highest level in nearly a year. Options markets have turned bullish too, with Brent skews now favouring calls - that benefit when prices rise - over the opposite puts as of Wednesday’s close.

Beyond the crisis, there are signs of adequate supply. OPEC+ intends to resume part of its shuttered capacity, with the additions set to begin in December, after a two-month delay. In the US, official statistics showed that crude inventories unexpectedly increased by 3.9 million barrels last week, the biggest leap in about five months.

Crude oil rose for a third day as traders reassessed supply risks in the Middle East, where Israel is seen as likely to make a retaliatory strike against Iran after Tehran's missile attack this week.

Crude oil rose for a third day as traders reassessed supply risks in the Middle East, where Israel is seen as likely to make a retaliatory strike against Iran after Tehran's missile attack this week. Brent crude moved toward $75 a barrel after an almost 3 per cent gain in the previous two sessions. Meanwhile, West Texas Intermediate stagnated near $71. Israel threatened Iran with reprisals, although US President Joe Biden has called upon the country to hold off from targeting its nuclear sites. The oil market remains captivated by the stalemate in the Middle East, which comes after a year of unrest as Israel faces off against Iran and its proxies in Gaza, Lebanon, Yemen, and other areas. The region is responsible for about a third of global supply, and traders are worried that the latest escalation could disrupt flows if energy facilities come under attack or supply routes are obstructed. Citigroup Inc. says a major strike by Israel on Iran's oil-exporting capacity may eliminate 1.5 million barrels of supply that is supplied into the market every day. According to analysts including Francesco Martoccia in a note, if the smaller infrastructure on target meant targeting these downstream assets and the storage facilities, output disruption would be between 300,000 and 450,000 barrels. The recent price increases have pushed a gauge of Brent's implied volatility to its highest level in nearly a year. Options markets have turned bullish too, with Brent skews now favouring calls - that benefit when prices rise - over the opposite puts as of Wednesday’s close. Beyond the crisis, there are signs of adequate supply. OPEC+ intends to resume part of its shuttered capacity, with the additions set to begin in December, after a two-month delay. In the US, official statistics showed that crude inventories unexpectedly increased by 3.9 million barrels last week, the biggest leap in about five months.

Oil rises for third straight day amid West Asia supply concerns

As the seismic market events of the previous several years begin to fade, the world's leading commodities analysts are facing a more challenging climate when it comes to trading oil. While industry titans are profitable, these are no longer the blockbuster figures banked since 2020. Profits at top oil companies - like Glencore and Gunvor group - are down, and even hedge fund leader Pierre Andurand is feeling the effects of the downturn.

World's top oil traders see boom years fade

Oil is headed for a fourth consecutive weekly slide, as concerns over demand from the world's biggest economies are outweighing increased geopolitical tensions. Brent traded near $80 a barrel after a 1.6 per cent drop in yesterday's session, with West Texas Intermediate below $77. Factory gauges in the US and China both showed a contraction on Thursday, indicating signs of weakness in manufacturing.

Although prices did surge briefly on Wednesday, after the killing of Hamas and Hezbollah leaders that raised tension in West Asia, the pressure on oil prices has not abated. There are still concerns about demand from China, the world's biggest oil importer, over its economic challenges. Bolstering the downward pressure was Thursday's reiteration by OPEC+ in a monitoring meeting of its plan to boost production in the next quarter.

It is the longest streak of weekly declines since December, with futures still modestly higher for the year. Some support has come from expectations that US monetary easing would perk up consumption, with Federal Reserve Chair Jerome Powell hinting an interest rate cut could happen as soon as September.

Other market metrics also suggest a less tight market. While still in a bullish backwardated structure, the gap between Brent's two nearest contracts has also narrowed. The spread was last trading at 60 cents a barrel in backwardation versus more than a dollar two weeks ago.

In summary, demand concerns in key economies and anticipated supply increases from OPEC+ weigh heavily on oil prices. With surging geopolitical tensions adding to the market's volatility, the outlook remains murky for oil, underscoring the tricky balance between supply, demand, and external drivers impacting the energy market.

Oil is headed for a fourth consecutive weekly slide, as concerns over demand from the world's biggest economies are outweighing increased geopolitical tensions. Brent traded near $80 a barrel after a 1.

Oil is headed for a fourth consecutive weekly slide, as concerns over demand from the world's biggest economies are outweighing increased geopolitical tensions. Brent traded near $80 a barrel after a 1.6 per cent drop in yesterday's session, with West Texas Intermediate below $77. Factory gauges in the US and China both showed a contraction on Thursday, indicating signs of weakness in manufacturing. Although prices did surge briefly on Wednesday, after the killing of Hamas and Hezbollah leaders that raised tension in West Asia, the pressure on oil prices has not abated. There are still concerns about demand from China, the world's biggest oil importer, over its economic challenges. Bolstering the downward pressure was Thursday's reiteration by OPEC+ in a monitoring meeting of its plan to boost production in the next quarter. It is the longest streak of weekly declines since December, with futures still modestly higher for the year. Some support has come from expectations that US monetary easing would perk up consumption, with Federal Reserve Chair Jerome Powell hinting an interest rate cut could happen as soon as September. Other market metrics also suggest a less tight market. While still in a bullish backwardated structure, the gap between Brent's two nearest contracts has also narrowed. The spread was last trading at 60 cents a barrel in backwardation versus more than a dollar two weeks ago. In summary, demand concerns in key economies and anticipated supply increases from OPEC+ weigh heavily on oil prices. With surging geopolitical tensions adding to the market's volatility, the outlook remains murky for oil, underscoring the tricky balance between supply, demand, and external drivers impacting the energy market.

Oil prices plunge as demand concerns and geopolitical tensions bite

Oil prices inched higher, extending their biggest daily gain in a month, as US crude stockpiles continue to decline.

Brent crude jumped above $85 a barrel, rising 1.6 per cent Wednesday, while West Texas Intermediate traded just shy of $83. According to data from the Energy Information Administration, crude inventories in the US fell by 4.87 million barrels last week. It's the third straight week of declines and the lowest since February. While inventories typically decline this time of year, current levels are below the five-year seasonal average.

Although supply cuts from OPEC+ have underpinned oil prices this year, increased production from non-cartel countries has offset these cuts. Meanwhile, expectations of looser monetary policy from the US have supported crude by boosting the appeal of risk assets and putting downward pressure on the US dollar. A weaker dollar makes dollar-denominated commodities more appealing to international buyers.

Timespreads, meanwhile, have strengthened, indicating strong near-term demand. The prompt spread, or the gap between Brent's two nearest contracts, is more than $1 a barrel in backwardation — when the nearest contract trades above the next, compared with 80 cents a month ago.

Futures are “breaking away from a losing streak as a substantial correction in the US dollar supports oil prices,” said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova Pte. Also, a steeper-than-anticipated drop in US stockpiles signalled that consumption remains strong and could counter concerns about China's economic growth, she said.

Further out, oil prices continued steady strides despite concerns over global economic conditions, as the relentless fall of US crude stockpiles and the expected looser monetary policy actions have kept prices sturdy. On the same note, timespreads indicate that near-term demand remains firm and points to a positive short-term outlook for the oil market.

Oil prices inched higher, extending their biggest daily gain in a month, as US crude stockpiles continue to decline. Brent crude jumped above $85 a barrel, rising 1.

Oil prices inched higher, extending their biggest daily gain in a month, as US crude stockpiles continue to decline. Brent crude jumped above $85 a barrel, rising 1.6 per cent Wednesday, while West Texas Intermediate traded just shy of $83. According to data from the Energy Information Administration, crude inventories in the US fell by 4.87 million barrels last week. It's the third straight week of declines and the lowest since February. While inventories typically decline this time of year, current levels are below the five-year seasonal average. Although supply cuts from OPEC+ have underpinned oil prices this year, increased production from non-cartel countries has offset these cuts. Meanwhile, expectations of looser monetary policy from the US have supported crude by boosting the appeal of risk assets and putting downward pressure on the US dollar. A weaker dollar makes dollar-denominated commodities more appealing to international buyers. Timespreads, meanwhile, have strengthened, indicating strong near-term demand. The prompt spread, or the gap between Brent's two nearest contracts, is more than $1 a barrel in backwardation — when the nearest contract trades above the next, compared with 80 cents a month ago. Futures are “breaking away from a losing streak as a substantial correction in the US dollar supports oil prices,” said Priyanka Sachdeva, senior market analyst at brokerage Phillip Nova Pte. Also, a steeper-than-anticipated drop in US stockpiles signalled that consumption remains strong and could counter concerns about China's economic growth, she said. Further out, oil prices continued steady strides despite concerns over global economic conditions, as the relentless fall of US crude stockpiles and the expected looser monetary policy actions have kept prices sturdy. On the same note, timespreads indicate that near-term demand remains firm and points to a positive short-term outlook for the oil market.

Relentless US crude stockpile decline spurs buoyant oil market

Oil prices seesawed Monday following an apparent assassination attempt on Republican presidential candidate Donald Trump, and ahead of China's Third Plenum.

Brent crude changed hands near $85 a barrel, as West Texas Intermediate remained above $82. The attack on Trump heaped further uncertainty into the race for the US presidency, thereby bolstering the dollar. Making dollar-priced commodities, including oil, more expensive.

Despite the volatility, oil prices remained significantly higher for the year, underpinned by the OPEC+ production cuts and robust fuel demand in the Northern Hemisphere's summer season. The investment world will look out for the Chinese Communist Party's Third Plenum this week, which is expected to show hints of the country's economic and political priorities, as it remains the world's largest crude importer.

China's appetite for raw materials, including crude oil, has waned in the first half of the year, putting a huge question mark on future demand. GDP growth slipped to its weakest in five quarters, while the International Energy Agency indicated that China's slackening economy may dampen global oil consumption growth.

“It’s not surprising following the attempted assassination of former President Donald Trump over the weekend that we are seeing a stronger US dollar, and that strength is weighing on oil,” said Warren Patterson, head of commodities strategy for ING Groep NV. “In addition, the market is also coming around to the idea that Chinese oil demand could very well disappoint this year.”

Nevertheless, timespreads suggest strong near-term demand. The gap between Brent's two nearest contracts remained in a bullish, backwardated structure, with the nearest contract trading at a premium over the later-dated one. At 95 cents a barrel, it’s almost double what it was a month ago.

The oil market is sailing through stormy seas of geopolitical events and a maze of economic indicators. The attempted assassination of Trump and China's Third Plenum added significant uncertainty, while the underlying signals of demand remained strong. Market participants will keenly watch these factors as China's trajectory becomes clearer.

Oil prices seesawed Monday following an apparent assassination attempt on Republican presidential candidate Donald Trump, and ahead of China's Third Plenum. Brent crude changed hands near $85 a barrel, as West Texas Intermediate remained above $82.

Oil prices seesawed Monday following an apparent assassination attempt on Republican presidential candidate Donald Trump, and ahead of China's Third Plenum. Brent crude changed hands near $85 a barrel, as West Texas Intermediate remained above $82. The attack on Trump heaped further uncertainty into the race for the US presidency, thereby bolstering the dollar. Making dollar-priced commodities, including oil, more expensive. Despite the volatility, oil prices remained significantly higher for the year, underpinned by the OPEC+ production cuts and robust fuel demand in the Northern Hemisphere's summer season. The investment world will look out for the Chinese Communist Party's Third Plenum this week, which is expected to show hints of the country's economic and political priorities, as it remains the world's largest crude importer. China's appetite for raw materials, including crude oil, has waned in the first half of the year, putting a huge question mark on future demand. GDP growth slipped to its weakest in five quarters, while the International Energy Agency indicated that China's slackening economy may dampen global oil consumption growth. “It’s not surprising following the attempted assassination of former President Donald Trump over the weekend that we are seeing a stronger US dollar, and that strength is weighing on oil,” said Warren Patterson, head of commodities strategy for ING Groep NV. “In addition, the market is also coming around to the idea that Chinese oil demand could very well disappoint this year.” Nevertheless, timespreads suggest strong near-term demand. The gap between Brent's two nearest contracts remained in a bullish, backwardated structure, with the nearest contract trading at a premium over the later-dated one. At 95 cents a barrel, it’s almost double what it was a month ago. The oil market is sailing through stormy seas of geopolitical events and a maze of economic indicators. The attempted assassination of Trump and China's Third Plenum added significant uncertainty, while the underlying signals of demand remained strong. Market participants will keenly watch these factors as China's trajectory becomes clearer.

Oil market oscillates amid geopolitical shockwaves and economic pivots

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