The crude rates are in focus in today’s trade. The prices scaling well past the $115/bbl mark is unsettling for investors. More than a month into the West Asia conflict, and energy prices have skyrocketed. Market experts have signalled that the possibility of crude at $200/bbl now remains high.
Crude jumps to 2-week highs
In early Asian trade Monday, Brent crude futures surged to its two-week high of $116/bbl as escalations over the US-Israel conflict with Iran keep the markets on edge.
US President Donald Trump has been giving out contradictory signals over the Iranian war, causing uncertainty in the energy markets as Brent crude prices rose by 3% from Friday’s close. Financial Times reported that Trump has said, “He wants to take oil in Iran,” which has further heightened fears in the energy markets.
Possibility of oil at $200 now high
Market Veteran, Ajay Bagga in a social media post on X said that the possibility of oil reaching the $200 mark now remains high, which would trigger global recession also with huge economic hurdles.
“The possibility of a $200 oil is high. That brings a global recession and intense economic pain as a stark reality. Totally avoidable outcome that should have never happened,” he added.
Previously, Tehran had warned that the world should brace for a possibility of oil at the $200/bbl mark. Now investors remain particularly doubtful over a resolution in the West Asia conflict.
Yemen joins the conflict; crude prices surge
As Yemen-backed Houthi rebel groups carried out strikes on Israel, the prospects of de-escalation in the conflict ceased. The reports of the US military preparing to deploy ground troops in Iran have also diminished the prospects of oil prices coming down from their free fall.
“Crude oil remains the most critical macro variable at this stage. Brent prices have surged over 50% in March and are now revisiting early-war highs, despite ongoing diplomatic efforts. Market participants are increasingly pricing in a prolonged supply disruption scenario, with some global estimates indicating a potential spike towards $200 per barrel if tensions persist,” said Hariprasad K, SEBI-registered Research Analyst and Founder, Livelong Wealth.
What does it mean for India?
For an import-dependent economy like India, this creates a direct risk through higher inflation, pressure on corporate margins, and a deteriorating current account.
According to Ponmudi R, CEO of Enrich Money, even if geopolitical tensions ease in the near term, the economic impact is likely to linger. He adds that persistently high crude prices and rising input costs are likely to sustain inflationary pressures, potentially compressing margins and dampening consumption, thereby affecting the earnings outlook in the coming quarters.
“This indicates that the current situation is not a short-term disruption but could have a broader cyclical impact,” he added.