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Crude oil prices are continuously rising in the international market these days. From America to India, crude oil is making its power felt and is giving a clear message to the global market that at present there is no other asset class bigger than ‘Bahubali’. If we talk about India, the prices of crude oil here have reached their all-time high. A major reason for this is the falling credibility of the rupee against the dollar. On the other hand, there has been a huge rise in prices in the international market also. Especially the price of American oil WTI has crossed $ 116 per barrel, which is about $ 4 more than the Brent crude of Gulf countries. Let us know why oil prices are increasing so drastically.

Crude oil created new history in India

Crude oil set a new record in the Indian market on Tuesday. On MCX i.e. Multi Commodity Exchange, the price of crude oil for April supply jumped by Rs 300 or 2.83 percent to reach a historic level of Rs 10,888 per barrel. Not only April, but May deals also saw a rise and it touched a record high of Rs 9,485 per barrel.

The price continued to fluctuate during trading, but by afternoon it was seen trading around Rs 10,745. Market experts believe that the poor global supply situation and uncertainty over the Strait of Hormuz, the most important sea route for energy export, are the main reasons for this rise. Rising tensions in the Middle East have increased traders’ concerns, further boosting prices.

Why did oil prices soar in India?

Experts say that geopolitical tension is at its peak ahead of the deadline given by US President Donald Trump to Iran. According to Choice Broking analyst Kaveri More, the market has now become very sensitive to every small and big movement happening in the Strait of Hormuz. Threats of possible attacks on Iran’s oil facilities and warnings of retaliation from Iran have created fears of supply chain disruption.

The Strait of Hormuz is the most important route for the world’s oil trade, and any blockage there would mean a global crisis. Along with this, the strengthening of the US dollar above the 100 level and rising inflation fears have also sent oil prices skyrocketing.

WTI’s dominance in foreign markets

The condition of foreign markets is also similar. According to the data, the future price of American oil West Texas Intermediate (WTI) has increased by $ 4.14 to $ 116.55 per barrel. At the same time, Brent crude of Gulf countries is at $ 111.40 per barrel. This is a rare situation when the price of American oil has become higher than the oil of Gulf countries. Experts clearly say that until the dispute over the Strait of Hormuz is resolved, there is little hope of softening of prices.

Will prices increase further?

According to Jigar Trivedi, Senior Research Analyst at IndusInd Securities, WTI crude is now heading towards $115-116, its highest level since June 2022. Trump’s warning to Iran and threats to attack Iran’s power plants have added fuel to the fire. On the other hand, news of Israel’s attack on Iran’s petrochemical complex has spooked investors. Everyone is afraid that this conflict may spread to the entire region, due to which oil production may come to a complete halt. At present, investors are keeping an eye on the developments in West Asia and there may be huge fluctuations in the market in the coming days.