Crude Oil Futures Fall Over 1 PC As Supply Fears Fade Amid Iran Deal Optimism

New Delhi: Crude oil futures fell by Rs 80 to Rs 6,589 per barrel on Thursday as improving prospects of a US-Iran agreement and rising shipments through key export routes eased concerns over global supply disruptions.

Extending the slide for the fourth straight session, crude oil for the July delivery slipped by Rs 80, or 1.2 per cent, to Rs 6,589 per barrel in a business turnover of 5,847 lots on the Multi Commodity Exchange (MCX).

The August contract also weakened by Rs 76, or 1.14 per cent, to Rs 6,587 per barrel in 2,023 lots on the MCX.

Analysts said the selloff comes as market participants increasingly bet that a potential agreement between Washington and Tehran could pave the way for additional Iranian crude exports and reduce risks to shipments through the Strait of Hormuz, a critical route for global oil trade.

“MCX crude slipped more than 1 per cent as improving prospects for a US-Iran agreement eased supply concerns,” Pinky Yadav, Commodity Fundamental Analyst at Choice Broking, said.

Growing confidence in a lasting peace deal has encouraged increased tanker movement through the Strait of Hormuz, while crude exports from the Middle East and West Africa have increased, helping alleviate concerns over supply disruptions, she added.

The weakness also reflected in the international markets.

Brent oil futures for August contract fell 1.55 per cent to USD 72.60 per barrel on the ICE, and West Texas Intermediate crude oil was trading 1.25 per cent lower at USD 69.46 per barrel on the NYMEX.

“Crude oil prices extended their decline, with WTI falling below USD 70 per barrel and erasing most of the gains recorded during the conflict in West Asia,” Yadav said.

She added that a temporary US waiver permitting purchases of already-loaded Iranian crude cargoes is expected to bring additional barrels into the energy market, further easing supply tightness.

“The increased availability of crude has outweighed supportive inventory data from the US, where stockpiles fell to their lowest level since 1984.

“As a result, global oil prices have declined sharply from their wartime highs amid improving supply conditions,” Yadav added.

Traders are closely watching developments in the US-Iran negotiations and crude flows through the Strait of Hormuz for fresh cues on oil price direction.

(Disclaimer: Except for the headline, this article has not been edited by HDFC Sky editorial team and is auto-generated from PTI feed.)