International oil prices fell over 2% on Friday after the US signalled potential easing of sanctions on Iranian oil and global powers backed efforts to secure shipping through the Strait of Hormuz.
The moves point to early attempts to stabiliZe supplies after crude surged to multi-month highs amid escalating tensions in West Asia.
At 8:11 AM, the April contract of Brent crude on the Intercontinental Exchange was trading at $105.88 per barrel, down 2.44% from its previous close. Similarly, the April contract of West Texas Intermediate (WTI) on NYMEX was at $93.20 per barrel, lower by 2.46%.
have been volatile since the start of the war on 28 February, with Brent briefly nearing $119 per barrel on Thursday.
Sanctions signal
US Treasury Secretary Scott Bessent, in an interview with Fox Business Network on Thursday, said Washington may ease restrictions on Iranian oil already at sea to cool prices.
“In the coming days, we may unsanction the Iranian oil that’s on the water. It’s about 140 million barrels,” he said.
He added that the US has so far allowed Iranian oil to continue flowing out of the Gulf and indicated that more flexibility could be considered.
The US has already waived sanctions on Russian oil shipments for a month for all crude-buying countries, effective 12 March. For India, the waiver was announced on 5 March.
Bessent said the US is not targeting Iran’s energy infrastructure and retains multiple levers to influence supply.
“There is plenty more the US can do on oil supply,” he said, adding that another release from the Strategic Petroleum Reserve (SPR) remains a possibility to ease prices.
Global push
Further easing sentiment, several major economies signalled support for ensuring safe passage through the —a key chokepoint for nearly 20% of global oil and gas supplies.
Leaders of Britain, France, Germany, Italy, the Netherlands and Japan issued a joint statement urging “an immediate comprehensive moratorium on attacks on civilian infrastructure, including oil and gas installations”.
“We express our readiness to contribute to appropriate efforts to ensure safe passage through the Strait,” the statement said, adding that countries would also work with oil producers to increase output and stabilize markets.
India impact
The volatility carries significant implications for India, which imports nearly 90% of its crude oil requirements.
The Indian basket of crude surged to $146.39 per barrel on 18 March, while the monthly average for March stands at $114.08 per barrel—well above February’s average of $69.01.
The Indian basket represents a mix of sour grade (Oman and Dubai average) and sweet grade (Brent dated) crude processed in domestic refineries in a ratio of 78.71:21.29.
Every $1 per barrel increase in crude prices can raise India’s annual import bill by roughly ₹16,000 crore, amplifying pressure on the fiscal balance and inflation.
The strain is already visible in the domestic LPG market, where supply disruptions linked to the West Asia conflict have tightened availability in recent weeks, emerging as an early stress point for consumers.