Airline stocks InterGlobe Aviation (IndiGo) and SpiceJet recovered on Tuesday, March 10, supported by a sharp drop in crude oil prices and growing optimism that the US-Iran conflict could ease sooner than expected. The fall in oil prices also raised hopes that airline operations could gradually stabilise after recent disruptions.
Crude oil prices dropped nearly 10% in early trade after US President Donald Trump indicated that the war with Iran could end sooner than initially feared and signalled the possibility of easing certain oil-related sanctions.
IndiGo, SpiceJet: What’s behind the share price rebound?
Oil markets reacted sharply to Trump’s comments suggesting the conflict may be shorter than anticipated. He also said the US administration was considering steps to stabilise energy markets, including easing oil-related sanctions and sending the US Navy to escort tankers through the Strait of Hormuz to ensure crude shipments continue smoothly.
Meanwhile, the Group of Seven (G7) countries said on Monday that the bloc is ready to take “necessary measures,” including releasing strategic oil reserves, to support global energy supplies if required.
As a result, Brent crude was trading nearly 6% lower at around $99 per barrel at about 9:15 am IST on Tuesday after falling up to 10% in early deals.
The fall in oil prices provided relief to Indian markets, as rising crude costs can significantly pressure the country’s macroeconomic conditions by increasing import bills and inflation risks.
The decline came after a sharp rally in the previous session, when Brent crude surged to nearly $120 per barrel, its highest level since July 2022, amid fears that the conflict could disrupt global oil supplies.
Speaking to reporters on Monday, Trump said the administration was considering removing oil-related sanctions and suggested the conflict could end sooner than expected, helping calm market fears that had pushed prices sharply higher.
“We’re looking to keep the oil prices down,” Trump said.
more to come….