US-Iran war: Oil prices edged higher on Thursday, 14 May, as investors closely watched the crucial meeting between US President Donald Trump and Chinese President Xi Jinping for any positive developments regarding the Iran conflict, which has severely impacted global oil supplies.
gained 26 cents, or 0.25%, to $105.89 per barrel, while US West Texas Intermediate (WTI) crude futures rose 32 cents, or 0.32%, to $101.34 per barrel.
Both benchmark contracts had declined on Wednesday, with Brent crude dropping more than $2 a barrel and WTI crude over $1.
Back home, crude oil prices on (MCX) also turned green after opening in the red. MCX crude oil prices rose marginally to ₹9,713 per barrel.
What’s driving crude oil prices today?
Trump was accorded a grand welcome at the Great Hall of the People on Thursday ahead of key discussions with Chinese President Xi Jinping, expected to focus on the fragile trade truce between the two nations, the Iran conflict, and US arms sales to Taiwan, according to a Reuters report.
Although Trump has said he does not believe China’s support is necessary to end the war, he is still expected to seek Xi’s assistance in helping resolve the expensive and politically unpopular conflict.
Meanwhile, Iran appears to have strengthened its grip over the strait by striking agreements with Iraq and Pakistan to transport oil and liquefied natural gas from the region.
A ceasefire has remained in effect since early April despite intermittent flare-ups. Still, the US and Iran have made limited headway in bridging their differences or finalising a peace proposal. As a result, the strait has effectively remained shut, disrupting critical energy supplies to global markets.
Reuters quoted the International Energy Agency on Wednesday as saying that global oil supply is now expected to lag demand this year, as the conflict severely disrupts Middle East oil production and depletes inventories at a record pace, reversing its earlier projection of a supply surplus.
Where are crude oil prices headed?
Anindya Banerjee, Head of Commodity and Currency Research, Kotak Securities, believes that India remains relatively cushioned for now, but no large oil-importing economy is fully insulated from a deficit of this scale. If the Strait of Hormuz does not reopen by the end of May, today’s price is a floor, not a ceiling, he observed.
“At Brent $107 and WTI $102, the market is still treating this as a manageable, near-term disruption — the underlying supply math says otherwise,” Bamerjee said.
On a technical outlook, Ponmudi R, CEO of Enrich Money, said that is trading in the ₹9,600– ₹9,700 zone, attempting to stabilise after a sharp pullback from recent highs.
“The price continues to hold above the ascending trendline, which is providing underlying support. Immediate resistance stands at ₹9,800– ₹9,900; a sustained move above this zone could revive bullish momentum and push prices toward ₹10,000– ₹10,200. On the downside, ₹9,500 acts as immediate support, with ₹9,200 as the next stronger base if selling pressure intensifies. The near-term bias remains cautiously bullish, with direction contingent on ongoing developments in the Strait of Hormuz and global supply disruption risks,” Ponmudi said.
(With inputs from agencies)
Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.