Global crude oil prices continued to trade higher on Friday morning amid ongoing supply disruptions through the Strait of Hormuz and little progress in US-Iran peace talks.
At 7:08 am, the June Brent contract on the Intercontinental Exchange was trading at $106.57, up 1.43% from its previous close. The May contract of West Texas Intermediate on NYMEX rose 1.29% to $97.06 per barrel.
US President Donald Trump on Thursday declined to provide a timeline for the end of the Iran war. Responding to a question on a prospective timeline, Trump told reporters at the White House: “Don’t rush me.”
The US president blamed what he described as a lack of clear leadership in Iran for holding up talks.
Amid expectations of divisions within the Iranian leadership, Iran’s President, Masoud Pezeshkian, said in a tweet: “In Iran, there are no radicals or moderates; we are all ‘Iranian’ and ‘revolutionary,’ and with the iron unity of the nation and government, with complete obedience to the Supreme Leader of the Revolution, we will make the aggressor criminal regret his actions. One God, one nation, one leader, and one path; that path being the path to the victory of our dear Iran, more precious than life.”
Military escalation
According to a CNN report, US military officials are developing new plans to target Iran’s capabilities in the if the current ceasefire falls apart. Trump has ordered the US Navy to attack any Iranian boats placing mines in the waterway.
Amid persistent tensions, Trump also said on Thursday that Iran may have reloaded its weaponry during the ongoing ceasefire and that the US is ready to neutralize any such build-up.
India’s exposure
India imports nearly 90% of its crude oil requirement, making supply disruptions and price volatility a significant macroeconomic risk. A $1 per barrel increase in oil prices sustained over a year can raise India’s annual import bill by ₹16,000 crore.
The strait remains a critical energy artery for India, traditionally accounting for about 60% of its , nearly 50% of liquefied natural gas (LNG) imports and 90% of liquefied petroleum gas (LPG) imports.
OMC pressure
On Thursday, a petroleum ministry official said that amid high oil prices, state-run oil marketing companies (OMCs) are losing ₹20 per litre on petrol sales and around ₹100 per litre on diesel.
Addressing the media on developments in and the fuel stock situation in the country, Sujata Sharma, joint secretary, ministry of petroleum and natural gas, noted that there is significant volatility in international crude oil prices. Despite that, the government has not increased retail fuel prices and excise duty cuts have been announced to avoid price hikes.