US-Iran war: Oil prices were largely steady on Tuesday as investors assessed the likelihood of US President Donald Trump moving to end the Iran conflict against risks of supply disruptions from a prolonged shutdown of the Strait of Hormuz, a crucial route for global oil shipments.
Brent crude for May delivery edged up 18 cents, or 0.16%, to $112.96 per barrel at 0438 GMT, after slipping 1% earlier in the session. The May contract is set to expire on Tuesday, while the more actively traded June contract stood at $107.10.
Meanwhile, U.S. West Texas Intermediate (WTI) crude for May delivery declined 25 cents, or 0.24%, to $102.63 per barrel, after touching its highest level since March 9 earlier in the day.
What’s driving crude oil prices today?
Donald Trump has indicated to aides that he may be prepared to halt the military campaign against Iran even if the Strait of Hormuz remains largely shut, leaving its reopening for a later stage, according to a report by The Wall Street Journal citing administration officials.
However, on Monday, Trump warned that the US would “obliterate” Iran’s energy infrastructure and oil facilities if Tehran failed to reopen the key shipping route.
Iran’s effective closure of the Strait of Hormuz — a crucial passage that typically handles around one-fifth of global oil supply along with significant volumes of liquefied natural gas — has driven a sharp rally in crude prices.
Brent crude futures have surged 59% so far in March, marking their biggest monthly gain on record, while WTI crude has climbed 58% during the month, its strongest rise since May 2020.
Underscoring the risks to seaborne energy supplies amid the conflict involving Iran, the US, and Israel, Kuwait Petroleum Corporation, was quoted as saying by Reuters, on Tuesday that its fully loaded crude tanker Al Salmi, with a capacity of up to 2 million barrels, was hit in an alleged Iranian attack at a Dubai port. Authorities also cautioned about the possibility of oil spills in the area.
Meanwhile, on Saturday, Yemen’s Iran-backed Houthi forces launched missile strikes toward Israel, heightening concerns over potential disruptions at the Bab el-Mandeb Strait — a critical maritime corridor connecting the Red Sea and the Gulf of Aden, and a vital route for trade between Asia and Europe via the Suez Canal.
Crude oil prices outlook
According to Aamir Makda, Commodity & Currency Analyst at Choice Broking, crude oil price has continued to rise over its key moving averages i.e. 20, 50 and 100-DEMA levels placed at 8416, 7325 and 6575 respectively.
“These will be crucial support levels to look for. On the other hand, immediate resistance would be at psychological level of 10,000. Breaching of this hurdle will boost the Oil prices and we may expect new all-time high level,”Makda said.
Meanwhile, Sugandha Sachdeva, founder of SS WealthStreet, believes that crude oil is likely to trade within a wide and volatile range.
“Key supports are placed at $93 and $73 per barrel (Brent Crude), while on the upside, a retest of $120 remains plausible, with an extended move towards $150 per barrel not ruled out if geopolitical risks intensify further. In essence, the market remains firmly geopolitics-driven, with supply disruptions, strategic reserve actions, and policy responses collectively shaping the near- to medium-term trajectory of oil prices,” Sachdeva said.
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.
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