- Global crude prices climbed over 3% due to US-Iran tensions.
- US strikes, Iran’s actions, heightened Strait of Hormuz concerns.
- Iran’s navy intercepted vessels, intensifying maritime security issues.
Global crude oil prices climbed more than 3 per cent on Monday, with the international benchmark Brent crude moving above the $90-a-barrel mark as renewed military tensions between the United States and Iran heightened fears of potential supply disruptions through the Strait of Hormuz.
Brent crude rose nearly 3 per cent, or $2.63, to trade above $90 a barrel after recording gains of more than 3 per cent in the previous session. US West Texas Intermediate (WTI) crude also advanced 3.51 per cent, or around $3, to $85.39 a barrel.
In the domestic market, MCX crude oil futures for August delivery climbed 2.65 per cent, or Rs 210, to an intraday high of Rs 8,120 as of 10:29 AM, reported IANS.
Escalating Conflict Fuels Oil Market Rally
The latest rally followed fresh military exchanges between the US and Iran over the weekend. Tehran said the ceasefire between the two countries had effectively collapsed, prompting renewed concerns over the safety of crude shipments through the Strait of Hormuz.
The US Central Command said American forces had carried out a ninth consecutive night of strikes on Iranian targets. It said the operations were intended to weaken military capabilities allegedly used in attacks on commercial and civilian shipping.
The developments have intensified worries over the security of one of the world’s most important oil transit routes, a key factor influencing global crude prices.
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Strait Of Hormuz Remains In Focus
Market participants are closely monitoring developments around the Strait of Hormuz, through which a significant share of global crude oil supplies is transported.
Maritime security concerns increased after Iran’s navy said it had intercepted four unidentified vessels attempting to pass through what it described as an unsafe route in the strait.
Reports cited by the agency said two of the vessels were involved in accidents and came to a halt, while the remaining ships turned back, adding to concerns over the safety of shipping in the region.
Experts See Near-Term Support For Crude Prices
Market experts believe crude oil prices are likely to remain supported in the near term as geopolitical tensions in the Middle East continue to underpin market sentiment.
They said concerns over possible disruptions to shipping through the Strait of Hormuz are providing support to both global and domestic crude prices.
Experts also noted that MCX crude has moved above the Rs 8,000 mark, indicating strong bullish momentum. While the near-term outlook for both domestic and international crude remains cautiously bullish, they said elevated prices could also lead to phases of consolidation.
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