Oil prices up 1% amid continued stalemate on US-Iran talks, closure of Strait of Hormuz

NEW DELHI: India’s crude import bill faces renewed pressure as global oil prices swung sharply on Friday, with Brent and West Texas Intermediate giving up early gains but still set for weekly gains of about 15% amid uncertainty over US-Iran negotiations and supply risks linked to the Strait of Hormuz.

The intraday reversal followed reports that Iranian foreign minister Seyed Abbas Araghchi is expected to visit Pakistan over the weekend, reviving hopes of stalled peace talks.

Taking to X, the Iranian foreign minister said on Friday evening, “Embarking on timely tour of Islamabad, Muscat, and Moscow. Purpose of my visits is to closely coordinate with our partners on bilateral matters and consult on regional developments. Our neighbors are our priority.”

Araghchi and Pakistani foreign minister Mohammad Ishaq Dar had a telephonic conversation on Sunday. A statement by Iran’s Tasnim news agency said both leaders discussed the latest regional developments, the international situation and bilateral relations.

At 5.22pm, the June contract of Brent on the Intercontinental Exchange (ICE) traded at $104.08, down 0.94% from previous close, while the May contract of West Texas Intermediate on the New York Mercantile Exchange (Nymex) fell 1.49% to $94.42 per barrel.

According to a Reuters report earlier today citing Pakistani government officials, a US logistics and security team was already in place for potential talks. The last round of peace talks was expected on 21 April but did not take place. The most recent talks were held on 11 April after the announcement of a 14-day ceasefire by Pakistani prime minister Shehbaz Sharif 7 April.

In early trading on Friday, crude prices had moved higher on concerns over supply disruptions through the Strait of Hormuz and limited progress in US-Iran peace talks. Prices also rose after US President Donald Trump declined on Thursday to provide a timeline for the end of the Iran war, saying, “Don’t rush me,” reinforcing uncertainty around the conflict.

According to a CNN report, US military officials are developing new plans to target Iran’s capabilities in the Strait of Hormuz if the current ceasefire falls through. Trump has ordered the US Navy to attack any Iranian boats placing mines in the waterway.

Amid persistent tensions, Trump also said on Thursday that Iran may have reloaded its weaponry during the ongoing ceasefire and that the US is ready to neutralize any such build-up.

A report by Equirus Securities noted that even if markets stabilize, prices are unlikely to fall to pre-war levels.

“Even if peace returns and SoH (Strait of Hormuz) fully reopens in 2H2026, a return to $60–70/bbl (barrel) range remains unlikely as mkt. is dealing with a deep inventory deficit, not just a temporary supply shock. As a result, stock rebuilding, logistics repricing, and repair costs are expected to keep oil prices structurally supported, with near-term equilibrium above $80/bbl,” it said.

India imports nearly 90% of its crude oil requirement, making supply disruptions and price volatility a significant macroeconomic risk. A $1 per barrel increase in oil prices sustained over a year can raise India’s annual import bill by ₹16,000 crore.

On Thursday, a petroleum ministry official said that amid high oil prices, state-run oil marketing companies (OMCs) are losing ₹20 per litre on petrol sales and around ₹100 per litre on diesel.

Addressing the media on developments in West Asia and the fuel stock situation in the country, Sujata Sharma, joint secretary, ministry of petroleum and natural gas, noted that there is significant volatility in international crude oil prices. Despite that, the government has not increased retail fuel prices and excise duty cuts have been announced to avoid price hikes.