US-Iran war: Oil prices recovered on Thursday following two consecutive sessions of decline, driven by persistent supply concerns amid uncertainty over a possible resolution to the Iran conflict. A drawdown in US crude inventories also heightened fears over tightening global stockpiles.
Brent crude futures gained 81 cents, or 0.77%, to trade at $105.83 a barrel, while US West Texas Intermediate crude futures advanced 97 cents, or 0.99%, to $99.23.
Back home, crude oil prices on Multi Commodity Exchange (MCX) also witnessed an upward movement, tracking global prices. MCX crude oil prices surged as much as 1.07% to ₹9,564 per barrel.
What’s behind the rise?
US President Donald Trump stated that negotiations with Iran were nearing completion, while also warning of additional military action if Tehran failed to agree to a peace deal.
Iran, meanwhile, cautioned against any further attacks and announced measures to strengthen its control over the strategically important Strait of Hormuz, a key shipping route that previously handled oil and liquefied natural gas exports accounting for nearly 20% of global consumption before the conflict disrupted operations.
According to a Reuters report, Iran unveiled a new “Persian Gulf Strait Authority” and said a “controlled maritime zone” would be established in the Strait of Hormuz on Wednesday.
Tehran had effectively shut the strait in response to US and Israeli strikes that triggered the war on February 28. Although most hostilities have subsided following an April ceasefire, Iran continues to restrict movement through Hormuz, while the U.S. has maintained a blockade along Iran’s coastline.
The US Energy Information Administration said that the United States drew nearly 10 million barrels of oil from its Strategic Petroleum Reserve last week — the largest weekly withdrawal ever recorded.
Crude oil price outlook
Kaynat Chainwala, AVP – Commodity Research, Kotak Securities, believes that oil prices are expected to remain volatile and highly sensitive to geopolitical headlines, with any setback in negotiations likely to trigger renewed upward pressure.
“WTI has support around $102, and a sustained break below that level could expose prices toward $98, while resistance is seen near the $108–110 zone. Brent support is placed around $105, while resistance is seen in the $112–115 region,” she added.
Meanwhile, on the technical outlook, Ponmudi R, CEO of Enrich Money, said that immediate resistance is placed at ₹1,58,800– ₹1,59,300; a sustained move above this zone could help strengthen momentum and push prices toward ₹1,59,800– ₹1,60,500.
“On the downside, ₹1,58,000– ₹1,57,500 acts as immediate support, while a break below this range may extend weakness toward ₹1,56,000– ₹1,55,000. The near-term bias remains cautious with a weak undertone, and a decisive move above resistance levels remains crucial for improving momentum, while direction continues to depend on global risk sentiment,” he added.
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