Israel-Iran war: Oil prices declined after US President Donald Trump once again extended the deadline related to action against Iran’s energy sector, providing short-term relief to financial markets while extending uncertainty over how the conflict may unfold into April.
fell as much as 2% to slip below $106 per barrel on Friday after having surged nearly 6% in the previous session, while West Texas Intermediate hovered around $93 a barrel.
Back home, crude oil prices on Multi Commodity Exchange (MCX) also witnessed a similar downtrend. MCX crude oil prices fell 1.31% to ₹8,879 per barrel.
What’s driving crude oil prices?
Trump said that although Tehran had sought a seven-day window, he granted a 10-day extension, pushing the revised deadline to April 6.
The extension provides additional time for diplomatic negotiations and enables the US to build up its military presence in the region. This deployment already includes Marine Expeditionary Units and troops from the Army’s 82nd Airborne Division, according to sources quoted as saying by Reuters.
In a separate report, The Wall Street Journal said the Pentagon is considering deploying as many as 10,000 more ground troops.
“Iran’s foreign minister has indicated that a U.S. proposal is under consideration but has ruled out direct negotiations, while President Trump has continued to urge Tehran to take a more serious approach toward a deal. Ongoing mixed signals from both sides suggest that any resolution is likely to be gradual, keeping market volatility elevated in the near term,” said Kaynat Chainwala, AVP – Commodity Research, Kotak Securities.
Meanwhile, is on track for a record monthly surge in March, as the conflict involving the US, Israel, and Iran has rattled the oil-rich Middle East. With Tehran effectively forcing the near-total shutdown of the Strait of Hormuz, the war has significantly disrupted critical energy supplies to the global economy.
Iran said on Thursday, as quoted by Tasnim News Agency, that it is awaiting a response after rejecting a 15-point US proposal to end the war and putting forward its own terms. These include recognition of Tehran’s control over the Strait of Hormuz, a crucial route linking the Persian Gulf to global markets.
Before the conflict began in late February, the key waterway accounted for roughly one-fifth of global oil shipments. Despite the broader stalemate, there has been a slight uptick over the past day in Iran-linked vessels — mainly bulk carriers and LPG ships — attempting to transit the passage.
Where are crude oil prices headed?
On the outlook, Chainwala said that Brent crude is currently holding above $107 per barrel, keeping the Brent–WTI spread elevated well above $10 per barrel, significantly higher than its typical low single-digit range, reflecting a stronger premium on seaborne crude.
“Overall, crude oil markets remain highly sensitive to geopolitical developments, with persistent volatility driven by uncertainty around U.S.–Iran relations and the absence of a clear de-escalation pathway,” she said.
(With inputs from agencies)
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