Global crude prices witnessed a marginal increase on Friday morning after sharp declines in the previous session.
Prices rose after Iran-backed militant group Hezbollah rejected the US-brokered ceasefire between Israel and Lebanon. Israeli strikes across Lebanon have also continued despite the ceasefire announcement.
Around 8:10 am, Brent crude was trading at $95.64 per barrel, up 0.64% from its previous close, while WTI was at $93.37 per barrel, higher by 0.35%.
Ceasefire under strain
Reuters reported that Hezbollah leader Naim Qassem on Thursday rejected the ceasefire agreement between Israel and the Lebanese government to halt the fighting.
The had raised hopes of a broader de-escalation in West Asia. However, it is contingent on the cessation of activities by Iran-backed Hezbollah.
A joint statement issued by the US, Lebanon and Israel following a fourth round of US-mediated talks in Washington said the ceasefire “is contingent on a complete cessation of Hezbollah fire and the evacuation of all Hezbollah operatives” from areas south of the Litani River.
Rising toll
As Israel’s attacks on Lebanon continue, an Al Jazeera report, citing the Lebanese health ministry, said that at least 3,526 people have been killed and 10,733 injured in Israeli strikes on Lebanon since 2 March.
These developments assume significance as Iran has maintained that a ceasefire in Lebanon is a prerequisite for any peace deal with the US.
In a tweet on 1 June, Iranian foreign minister Sayed Abbas Araghchi had said: “The ceasefire between Iran and the US is unequivocally a ceasefire on all fronts, including in Lebanon. Its violation on one front is a violation of the ceasefire on all fronts. The US and Israel are responsible for the consequences of any violation.”
India impact
The ongoing war and the resultant blockade of the have had a global impact. India, a net energy importer, has also been affected.
Supplies of liquefied petroleum gas (LPG) have been hit the hardest, with India traditionally sourcing nearly 90% of its from West Asia.
Addressing the media on Thursday, Sujata Sharma, joint secretary, Union ministry of petroleum and natural gas, said state-run oil marketing companies are witnessing an under-recovery of ₹700 on every LPG cylinder sold. The cumulative daily under-recovery of the OMCs stands at around ₹550 crore.
The price of the Indian crude oil basket stood at $100.13 per barrel as of 3 June. The average price so far this month has been $98.12 per barrel, compared with an average of $106.23 per barrel in May.