India News : International crude oil prices climbed sharply on Monday as escalating geopolitical tensions in the Middle East and renewed disruptions to oil shipments through the Strait of Hormuz pushed Brent crude above $90 per barrel for the first time in nearly six weeks. West Texas Intermediate (WTI) crude also crossed the $85 per barrel mark during the day’s trading.
Brent Crude Rises Over 2.8%
Brent crude opened the session $2.60 higher at $90.70 per barrel. Although prices briefly slipped below the $90 mark to $89.91 per barrel, they quickly recovered and touched an intraday high of $90.73 per barrel.
As of 11:15 a.m. IST, Brent crude was trading at $90.58 per barrel, up $2.48, or 2.81%, from the previous close.
WTI Crude Also Crosses $85
WTI crude opened $2.14 higher at $84.63 per barrel. During early trading, it briefly fell to $83.61 per barrel before rebounding to an intraday high of $85.39 per barrel.
By 11:15 a.m. IST, WTI crude was trading at $84.46 per barrel, up 2.39%.
Strait of Hormuz Disruptions Raise Global Supply Concerns
Market experts said the continued escalation of tensions in the Middle East has heightened fears of disruptions to global crude oil supplies.
According to Anil Bhansali, Executive Director of Finrex Treasury Advisors LLP, the intensifying confrontation between the United States and Iran has significantly reduced the prospects for stability in the region. He said concerns over disruptions to oil shipments through the Strait of Hormuz have further fueled market uncertainty.
Bhansali noted that a substantial share of the world’s crude oil exports passes through the strategic waterway. More than 70% of crude oil exports from the Gulf region are transported via the Strait of Hormuz, making any disruption a major risk to global energy supplies and a key driver of higher oil prices.
Rising Oil Prices Could Impact India’s Economy
Bhansali warned that sustained increases in crude oil prices could pose significant challenges for oil-importing countries such as India.
Higher oil prices could widen the country’s current account deficit, put pressure on its fiscal deficit targets, weaken the Indian rupee, accelerate inflation, and trigger increased foreign capital outflows.
He added that if oil prices remain elevated, the Indian government may have to take important policy decisions regarding subsidies, interest rates, and exchange rate management to mitigate the impact on the economy.
