Brent down 2% on uncertainty over US participation in Israel-Iran conflict

New Delhi: Oil prices eased on Friday morning as traders awaited the decision of the US over its participation in the Israel-Iran conflict.

The Brent August contract on the Intercontinental Exchange traded at $77.20 per barrel at 10.08 am, over 2% lower than its previous close.

The White House said on Thursday that President Donald Trump will decide whether or not the US gets directly involved in the Iran-Israel conflict within the next two weeks.

Also Read | Crude beyond current levels to impact India's GDP estimates

“Crude oil remains highly volatile, with prices reacting sharply to developments and statements related to the Israel-Iran conflict,” said Rahul Kalantri, vice president for commodities at Mehta Equities. “Yesterday, we saw a sharp jump in crude oil prices… but this morning we are seeing a dip in prices after the White House stated that President Trump will decide on Iran in two weeks, calming immediate fears of escalation.”

Still, oil is set for a third consecutive weekly gain, Kalantri added.

Supply disruptions

"The markets remain jittery as risks of supply disruptions from Iran and broader conflict escalation loom large. Geopolitical tensions and supply fears continue to support oil prices despite temporary pullbacks," he said.

Sriram Iyer, senior research analyst at Reliance Securities, noted that escalating hostilities in West Asia continued to fuel fears of regional supply disruptions and could cap any downside.

The India crude basket, which represents the price at which Indian refiners import oil, stood at $75.91 per barrel on Wednesday. The average price in June stands at $68.58 a barrel, compared with $64.04 in May.