Oil prices slipped on Monday after a sharp rally on Friday, following ongoing military strikes between Israel and Iran. Brent crude futures dropped 58 cents, or 0.8 per cent, to $73.65 a barrel by 0900 GMT. US West Texas Intermediate (WTI) fell 51 cents, or 0.7 per cent, to $72.47 a barrel.
Both global benchmarks had surged more than 13 per cent on Friday, settling 7 per cent higher—their highest levels since January. They briefly climbed over $4 a barrel during early Asian trading on Monday before giving up those gains.
Strait of Hormuz under spotlight
Though the conflict has not impacted oil production or export facilities yet, the oil market is closely watching the Strait of Hormuz, a vital waterway for global oil transport. Around 18 to 19 million barrels per day—about one-fifth of the world’s oil supply—pass through the narrow strait.
Analysts warn that any disruption here could push oil prices sharply higher. “Heightened fears over a Strait of Hormuz blockade could sharply lift prices,” said Toshitaka Tazawa, an analyst at Fujitomi Securities.
Iran, a key OPEC member, produces about 3.3 million barrels per day and exports over 2 million barrels per day of oil and fuel. Experts say OPEC+ producers have enough spare capacity to cover any potential disruption caused by Iranian supply cuts.
India says there’s no need to panic
India’s Petroleum Minister Hardeep Singh Puri urged people not to worry over global tensions. In a post on X, he wrote, “India has ample reserves of petroleum products like petrol, diesel, and LPG, and our production capacity in this area is also increasing.”
Speaking to the media on Monday, Puri said the government is monitoring the situation daily.
Trump, Merz call for peace
US President Donald Trump said on Sunday that he hoped Israel and Iran could broker a ceasefire. However, he added, “Sometimes countries have to fight it out first.” Trump confirmed the US. will continue supporting Israel but did not say if he asked them to pause the strikes.
German Chancellor Friedrich Merz also expressed concern. He said he hoped the G7 leaders’ meeting in Canada would help find a solution to the crisis and prevent it from escalating further.
Iran refuses talks under fire
Meanwhile, Iran has told mediators Qatar and Oman that it is unwilling to negotiate a ceasefire while under attack from Israel. This was reported by a Reuters source familiar with the ongoing talks.