Crude oil prices fall after Israel-Iran ceasefire; MCX crude oil slips below ₹6,000 level

Crude oil prices have dropped below ₹6,000 on the Multi Commodity Exchange (MCX) following the announcement of a ceasefire between Iran and Israel by US President Donald Trump, easing concerns in global markets.

MCX crude oil futures for July contract opened lower at ₹5,732 per barrel as against its previous close of ₹6,046 level. On Monday, MCX crude oil prices rallied 2.28% to a high of ₹6,550, and were trading 1.80% higher at ₹6,519 per barrel.

Brent crude futures dropped by $2.06, or 2.88%, reaching $69.42 a barrel at 1125 GMT. Meanwhile, U.S. West Texas Intermediate crude slipped by $2.05, or 2.99%, to $66.46, according to bloomberg.com.

A recent report from SBI indicates that with the ceasefire now in place, the scenario of 'ceasefire with Israel' has taken effect, and crude oil prices are expected to stabilize around USD 65.

During the recent conflict involving Israel, Iran, and the US, crude oil prices reached a peak of USD 79 per barrel on Monday due to market concerns about further escalation.

On Monday, United States President Donald Trump declared a "complete and total" ceasefire between Israel and Iran, announcing it would be effective in about six hours.

In a post on Truth Social, Trump stated that the ceasefire has been mutually agreed upon by both countries and would signify a major reduction in the hostilities that have affected the region.

As tensions begin to subside, global oil markets might regain stability, which is beneficial for oil-importing nations such as India. Decreased oil prices will aid in lowering the current account deficit and bolster economic growth.

Technical Views

According to Jigar Trivedi, Senior Research Analyst at Reliance Securities, MCX crude oil July contract has support at ₹5,700 per barrel level, while resistance is seen at ₹5,950 level.

“WTI crude oil futures hit its lowest level in nearly two weeks, after US President Donald Trump said that Israel and Iran have agreed to a ceasefire, alleviating fears of supply disruptions in the Middle East. The de-escalation has eased concerns that Iran might attempt to block the Strait of Hormuz, a critical chokepoint through which roughly 20% of the world’s oil passes,” said Jigar Trivedi.

Rahul Kalantri, VP Commodities, Mehta Equities Ltd, said that Crude oil shows very high prices volatility and gained in the early trading session after the U.S. strikes on the Iran’s nuclear facility over the weekend but prices unable to sustain at higher levels. Surprisingly the U.S. President announced ceasefire of the Israel-Iran war at midnight and pushed energy prices lower. Both benchmarks slipped to one week lows and slipped below $70 a barrel.

“If the Israel and Iran are agreed for the ceasefire could further push oil prices lower in the upcoming sessions. However, dollar index dropped to 98.20 on ceasefire and dovish Fed signals support crude oil prices at lowers. We expect crude oil prices to remain volatile in today’s session. Crude oil is having support at $65.70-65.00 and resistance is at $68.60-70.20 in today’s session. In INR crude oil has support at Rs5,910-5,830 while resistance at Rs6,200-6,350,” said Kalantri.

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