traded marginally higher on Wednesday morning, even as US President Donald Trump indicated a second round of talks with Iran this week.
At 10 am on Wednesday, June Brent oil futures were at $95.34, up by 0.58 per cent, and May crude oil futures on WTI (West Texas Intermediate) were at $91.30, up by 0.02 per cent. April crude oil futures were trading at ₹8507 on Multi Commodity Exchange (MCX) during the initial hour of trading on Wednesday against the previous close of ₹8571, down by 0.75 per cent, and May futures were trading at ₹8308 against the previous close of ₹8337, down by 0.35 per cent.
Referring to its phone interview with Trump, a New York Post report said Trump had claimed that discussions were ‘happening, but, a little bit slow’. He also said that a second round of direct negotiations to end the seven-week war would likely happen.
The report said that Trump called back New York Post with an update that something could be happening over the next two days, and US delegation is more inclined to visit Islamabad.
Trump did not mention who would represent the US in a potential second round of talks. However, he confirmed that he would not take part.
Meanwhile, a Reuters report, which quoted an unnamed US official, said that a US destroyer interdicted two oil tankers attempting to leave Iran on Tuesday, a day after the US blockade went into effect, and instructed the tankers to turn around.
The tankers had left Chabahar port on the Gulf of Oman and were contacted by the warship via radio communication, it said.
International Energy Agency’s (IEA) Oil Market Report for April said oil demand is expected to contract by 80,000 barrels per day this year, as the Iran war upends our global outlook. This would be the sharpest since Covid-19 slashed fuel consumption. Initially, the deepest cuts in oil use have come in West Asia and Asia Pacific, mainly for naphtha, LPG and jet fuel. However, demand destruction will spread as scarcity and higher prices persist.
It said that global oil supply plummeted by 10.1 million barrels a day to 97 million barrels a day in March, with continued attacks on energy infrastructure in West Asia and ongoing restrictions to tanker movements through the Strait of Hormuz leading to the largest disruption in history.
The announcement last week of a two-week ceasefire in the conflict in West Asia provided some welcome respite to global oil markets just as the impact of disruptions to supply and trade were spreading globally.
With oil-importing nations scrambling to source replacement barrels from an increasingly shrinking pool of supply, physical crude oil prices surged to record levels near $150 a barrel, far above the prices in futures markets, with the physical-futures disconnect becoming increasingly acute, it said.
Even steeper gains have been seen for refined products, with middle distillate prices in Singapore reaching all-time highs above $290 a barrel, the report said.
May nickel futures were trading at ₹1749.90 on MCX during the initial hour of trading on Wednesday against the previous close of ₹1701.50, up by 2.84 per cent.
On the National Commodities and Derivatives Exchange (NCDEX), April jeera contracts were trading at ₹21785 in the initial hour of trading on Wednesday against the previous close of ₹21565, up by 1.02 per cent.
April guargum futures were trading at ₹10640 on NCDEX in the initial hour of trading on Wednesday against the previous close of ₹10566, up by 0.70 per cent.