Early Times Report
NEW DELHI, July 13: Crude oil futures jumped Rs 384 to Rs 7,198 per barrel on Monday as renewed military confrontation between the US and Iran reignited fears of supply disruptions through the Strait of Hormuz. On the Multi Commodity Exchange (MCX), crude futures for July delivery jumped by Rs 384, or nearly 6 per cent, to Rs 7,198 per barrel in a business turnover of 19,274 lots.
Similarly, the August contract also advanced by Rs 359, or 5.25 per cent, to Rs 7,197 per barrel in 4,139 lots. Traders said fears of supply disruptions resurfaced after the US and Iran exchanged in fresh military strikes over the weekend, escalating tensions around the Strait of Hormuz, through which nearly a fifth of the world's oil supply passes.
The latest escalation followed Iran's strike on a commercial vessel in the strategic waterway and its subsequent announcement of the Strait's closure. Later, the US responded with fresh strikes on multiple Iranian targets, while Washington maintained that the waterway remained open to international navigation.
"MCX crude oil futures surged 5 per cent on Monday as escalating US-Iran tensions heightened fears of disruptions in the Strait of Hormuz, a key global oil transit route," Pinky Yadav, Commodity Fundamental Analyst at Choice Broking, said.
Globally, Brent crude oil futures for the September contract gained USD 3.59, or 4.72 per cent, to USD 79.60 per barrel on the ICE.
In addition, West Texas Intermediate (WTI) for August delivery rose USD 3.47, or nearly 5 per cent, to USD 74.88 per barrel on the NYMEX.
Yadav said WTI crude climbed to trade above USD 74 per barrel-mark after fresh military exchanges between Washington and Tehran, reduced tanker movement through the shipping lane and concerns over supply disruptions continued to support prices.
She added that prospects for renewed diplomacy have weakened as Tehran demanded progress on Hormuz transit and oil exports before talks could resume.
Meanwhile, the International Energy Agency has cautioned that prolonged geopolitical tensions could delay the rebuilding of global oil inventories, adding to concerns over supply tightness. (Agencies) |
