Mumbai: Crude oil prices stayed firm on Tuesday after a sharp jump of more than 10 per cent in the previous session. The rise came as tensions increased in West Asia, raising worries about global oil supplies.
US crude futures went up by 1.4 per cent to $72.23 per barrel. Brent crude, the global benchmark, gained 1.87 per cent to trade at $79.2 per barrel in early trade.
The price surge followed Iran’s reported retaliatory strikes on oil and gas facilities. Tehran is said to have targeted energy infrastructure in Saudi Arabia and also warned about possible threats to ships passing through the Strait of Hormuz. This narrow sea route is one of the world’s most important oil supply channels.
Strait of Hormuz in Focus
Around 20 per cent of global oil supply passes through the Strait of Hormuz. For India, the route is even more important, as over 40 per cent of its crude oil imports travel through this passage.
Any disruption here can quickly push global oil prices higher. Market experts say that while India may manage a short-term closure, a long shutdown would force the country to find other suppliers. India is already looking at alternatives such as Russia, Africa, and South America.
US Steps Calm Markets
Oil prices steadied after the US government said it would announce steps to control rising domestic energy prices. US Secretary of State Marco Rubio said that Treasury Secretary Scott Bessent and Energy Secretary Chris Wright would share plans to tackle the situation. This helped reduce panic buying in the market.
Price Risks Ahead
Investment bank Morgan Stanley warned that Brent crude could rise to $120 per barrel if the conflict worsens and oil flows through Hormuz are badly hit. Other reports suggest prices could move above $90 if there is disruption and even cross $100 in a wider regional war.
A small conflict could increase prices by $5–$10 per barrel. Direct damage to Iran’s oil facilities could add $10–$12 per barrel.
For India, every $1 rise in crude oil prices increases its annual import bill by about $2 billion, putting pressure on the country’s trade balance.
