Crude oil prices are continuously rising in the international market. From America to India, crude oil is making its power felt and is sending a message to the global market that there is no bigger powerhouse than it among all the existing asset classes. If we talk about India, crude oil prices have reached life time high. Another reason for this also includes the fall of rupee against dollar. On the other hand, crude oil prices have also increased in the international market. Especially the price of American oil WTI has crossed $ 116 per barrel. Which is about $ 4 per barrel more than the crude oil of Gulf countries. Let us also tell you what the prices of crude oil have become from America to India.
Crude oil made a new record in India
The futures price of crude oil increased by Rs 300 on Tuesday and reached a record level of Rs 10,888 per barrel. This rise in prices was due to continuous concerns over supply and geopolitical tensions in West Asia. On the Multi Commodity Exchange (MCX), the price of crude oil contract for delivery in April rose by Rs 300 or 2.83 percent to its highest ever level of Rs 10,888 per barrel. Similarly, the price of contract for supply in May reached a record level of Rs 9,485 per barrel on MCX with an increase of Rs 170 or 1.82 percent.
However, at 1:10 pm, crude oil is trading at Rs 10,745 per barrel with an increase of Rs 157 per barrel. However, in the morning the price of crude oil opened at Rs 10,722. According to analysts, crude oil prices are increasing due to the complex situation of global supply and uncertainty regarding the Strait of Hormuz, an important sea route for energy exports. This rise came after a huge increase in oil prices in the international market, as traders remain worried about possible supply disruptions and the ongoing conflict in West Asia.
Why did crude oil reach its peak in India?
Kaveri More, commodity analyst at Choice Broking, said crude oil prices remained stable as geopolitical tensions have increased ahead of US President Donald Trump’s deadline for Iran. Due to this, the markets have become very sensitive to every incident related to the Strait of Hormuz. He further said that threats of possible attacks on Iranian infrastructure and warnings from Tehran of retaliating against energy assets in the Gulf region have increased the fear of supply disruptions, which has weakened diplomatic efforts towards a ceasefire. More said that since the Strait of Hormuz is an important route for global oil flows, there is volatility in the market due to uncertainty. Additionally, rising inflation expectations and the US Dollar Index strengthening above the 100 level reflect macroeconomic concerns, which are directly linked to energy prices.
Tremendous growth in foreign markets
On the other hand, there is a good increase in the prices of crude oil in foreign markets also. If we look at the data, the future price of American oil West Texas Intermediate (WTI) crude oil supplied in May in the international market increased by $ 4.14 or 3.7 percent to $ 116.55 per barrel. At the same time, the price of Brent oil contract for supply in June from Gulf countries increased by 1.5 percent to $ 111.40 per barrel. It is rarely seen that the price of crude oil from Gulf countries is lower than the price of American oil. According to experts, until the Hormuz issue is resolved, crude oil prices will continue to rise.
Can prices increase further?
Jigar Trivedi, senior research analyst at IndusInd Securities, said WTI crude futures have moved towards $115 a barrel, and are trading near their highest close since June 2022. This is happening because the deadline given by President Trump for Iran to make an agreement or face intensified attacks is approaching. Meanwhile, Trump on Monday once again reiterated his threats to attack Iran’s power plants and other civilian infrastructure.
Further escalating tensions, Israel said it has attacked a major petrochemical complex in Iran. This has increased fears that the conflict could spread further, leading to further disruptions in energy production in the region. Investors are now closely monitoring the developments happening in West Asia. Market volatility is expected to remain as geopolitical risks continue to dominate energy markets.