North India Statesman
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Business Desk, New Delhi. Crude oil prices were seen softening in the international market on Monday morning. The global market has heaved a sigh of relief after ‘positive talks’ between America and Iran regarding the nuclear program in Oman. This diplomatic progress has reduced the fear in the minds of investors that the oil supply could be disrupted due to tensions in the Middle East.
The prices of both Brent crude and US crude (WTI) slipped by about 0.70% in early trade on Monday morning.
Oman talks gave ‘oxygen’ to the market
On Friday, it was agreed to continue indirect talks between America and Iran in Oman. Market analysts believe that even though differences remain between the two countries, the promise to remain at the negotiating table has averted the immediate threat of war.
Brent Crude Futures: down 49 cents (0.72%) $67.56 per barrel But he came.
WTI Crude: With a decline of 42 cents (0.66%) $63.13 per barrel But was trading.
The world’s eyes fixed on the Strait of Hormuz
The Strait of Hormuz is the most sensitive area for the crude oil market. Almost half of the world’s oil consumption passes through this narrow sea route between Oman and Iran. one-fifth (20%) passes. If tensions increase here, a global energy crisis may arise. Both benchmarks fell more than 2% last week on hopes of easing tensions, their first major decline in seven weeks.
Russia-Ukraine war and India’s big decision
The ongoing war between Russia and Ukraine is also having a deep impact on oil prices.
EU proposal: The European Commission has proposed a blanket ban on all services supporting Russian seaborne crude oil exports.
India’s strategy: Indian refiners, once the biggest buyers of Russian oil, are now avoiding purchasing Russian crude for April delivery. Sources believe that this step of India can strengthen future trade agreements with Washington.
Oil production increased in America
On the other hand, due to rising energy prices in America, efforts to increase production have intensified. According to ‘Baker Hughes’ report, US energy companies last week increased the number of oil and natural gas rigs for the third consecutive week for the first time since November. More rigs means more oil coming to the market in the future, which could lead to more stable prices.
