Global oil prices declined sharply on Tuesday after US President Donald Trump said a planned military strike on Iran had been paused to allow diplomatic talks aimed at easing tensions in the Middle East.
Brent, WTI Crude Drop Over 2%
Brent crude for July delivery fell by $3.01, or 2.7%, to $109.09 per barrel at 0001 GMT.
US West Texas Intermediate (WTI) crude for June delivery dropped by $1.38, or 1.3%, to $107.28 per barrel. In the previous session, both benchmarks had climbed to their highest levels since early May.
The June WTI contract is scheduled to expire on Tuesday, while the more actively traded July contract slipped by $2.06, or 2%, to $102.32 per barrel.
Trump Signals Possible Nuclear Deal
Trump said there was a “very good chance” that Washington and Tehran could reach an agreement preventing Iran from developing nuclear weapons.
His remarks came shortly after he announced a temporary pause in military action to allow negotiations with Iran.
Markets Watching for Signs of De-escalation
According to Tim Waterer, chief market analyst at KCM Trade, markets remain cautious despite the diplomatic signals.
“While Trump’s signal has eased some immediate pressure, the fundamental risks persist. The market is now watching whether Trump’s comments represent a genuine shift toward de-escalation or just a tactical pause,” Waterer told Reuters.
Strait of Hormuz Crisis Continues to Impact Global Supply
The ongoing conflict in the Middle East has severely disrupted movement through the Strait of Hormuz for more than 11 weeks.
The crucial maritime route handles nearly one-fifth of global oil supply, and prolonged disruption has sent shockwaves through international energy markets.
Fuel Prices Rise in India
With crude oil prices remaining above $100 per barrel globally, fuel prices in India have continued to rise.
Petrol and diesel prices were increased by around 90 paise per litre on Tuesday, marking the second hike within a week.
Following the latest revision, petrol prices in Delhi rose to ₹98.64 per litre from ₹97.77, while diesel prices increased to ₹91.58 per litre from ₹90.67.
Earlier ₹3 Hike Added Pressure on Consumers
The latest increase comes just days after oil marketing companies raised fuel prices by ₹3 per litre on Friday amid surging crude prices and continued instability around the Strait of Hormuz.
The current crisis began on February 28 after joint US-Israel strikes on Iran, following which Tehran tightened control over the strategic shipping route.
