Crude oil prices fell more than 5% on Tuesday, extending this week’s losses on hopes a U.S.-Iran deal to end the Middle East war will allow oil to flow through the Strait of Hormuz. After recording a high of $126 per barrel in the recent days, crude oil fell to $ 76 per barrel. The decline registers sharply by 16% is a three-month low.
Brent crude tumbled 15% with the US benchmark West Texas Intermediate was trading close to $77 a barrel. Brent crude has fallen to around $78 per barrel after five consecutive sessions of decline.
The transportation and logistics expenses across sectors are also likely to see moderation in the prices. According to commodity analysts- softer crude prices are a positive sign for Indian economy as India imports a large portion of its crude oil requirements. ” A sustained decline in Brent prices reduces the country’s dollar outflow for oil purchases, which can help narrow the current account deficit and provide support to the rupee, said”
Details began to emerge of the U.S. and Iran’s interim deal, with U.S. President Donald Trump saying it will rule out a nuclear weapon for Tehran and a U.S. official saying it allows Iran to sell oil upon signing.”
Earlier today, 3 Iranian oil tankers crossed the Strait of Hormuz as US lifted its naval blockade.