New Delhi, March 3 – Crude oil prices showed signs of stabilization on Tuesday following a sharp 10% rally in the previous session, as concerns over supply disruptions through the Strait of Hormuz amid escalating tensions in West Asia lingered.
US crude futures climbed 1.4% to $72.23 per barrel, while Brent crude rose 1.87% to trade at $79.2 per barrel in early deals. The volatility stems from fears that Iran’s retaliatory strikes could cripple oil and gas infrastructure, particularly after reports of attacks on Saudi facilities and warnings issued to vessels in the strategic waterway.
Market analysts point to a slight easing of panic after the US administration signaled measures to curb domestic energy costs. US Secretary of State Marco Rubio announced that Treasury Secretary Scott Bessent and Energy Secretary Chris Wright would unveil a plan on Tuesday to tackle rising prices.
The Strait of Hormuz, through which 20% of global oil shipments pass – and over 40% of India’s crude imports – remains a flashpoint. Experts warn that even a temporary closure could push Brent prices above $90 per barrel, with full-scale conflict potentially driving them to $120.
For India, every $1 increase in oil prices adds roughly $2 billion to its annual import bill, straining trade balances. While short-term disruptions can be managed through strategic reserves, prolonged closures would force diversification to suppliers like Russia, Africa, and South America.
Morgan Stanley forecasts severe upside risks if regional hostilities intensify, underscoring the fragile balance between geopolitics and global energy markets. As traders watch closely, the premium on oil reflects not just supply fears but broader inflationary pressures ahead.