Global oil prices extended gains on Tuesday morning as the war in West Asia showed no signs of easing and US president Donald Trump ramped up threats against Iran.
Brent crude rose above $111 per barrel while WTI surged close to $115, as traders reacted to the possibility of further military escalation and continued disruption in the Strait of Hormuz — a critical global oil chokepoint.
Markets are closely watching developments ahead of Trump’s deadline for Iran to reopen the , which has been blocked since the start of the war on 28 February, cutting off about 20% of global oil supplies for over a month.
Trump’s warning
Addressing the media on Monday, Trump intensified his threats to Iran, declaring the country could be “taken out in one night”. Experts said that traders and investors are closely watching the developments in the region in the run-up to the US president’s deadline.
Trump has warned of “complete demolition” of Iran’s power plants and bridges if the Strait of Hormuz is not fully reopened by Tuesday’s deadline. Further, he has also said that Iran’s response to the , conveyed through intermediaries, is “significant”, but “not good enough”.
He vowed that if no deal is reached, “every bridge in Iran will be decimated” and “every power plant in Iran will be out of business, burning, exploding and never to be used again”.
An Aljazeera report said that Iran’s military says Trump’s threats are “delusional” and cannot make up for the “disgrace and humiliation” of the US in the region.
Around 8 AM, the June contract of Brent on the Intercontinental Exchange was trading at $111.17 per barrel, higher by 1.28% from its previous close. The May contract of West Texas Intermediate on NYMEX rose 2.26% to $114.95 per barrel.
India impact
India, the third largest consumer and importer of crude oil in the world, has been significantly impacted by the volatility as it imports 90% of its overall oil requirement. A $1 per barrel increase sustained over a year can raise India’s total import bill by ₹16,000 crore.
On Monday, a petroleum ministry official said that amid the crisis, refineries of state-run companies will delay scheduled maintenance to ensure continued supply of petroleum products.
To ensure stable and uninterrupted fuel supplies, refineries of state-run Indian Oil Corp. (IOC) and Bharat Petroleum Corp. (BPCL) have postponed routine at some of their refineries, Sujata Sharma, joint secretary at the ministry of petroleum and natural gas, told reporters.
She reiterated that all refineries are operating at high capacity with adequate crude inventories. Sufficient stocks of petrol and diesel are being maintained, and domestic LPG production from refineries has been increased to support consumption.