Oil prices surge amid stalemate in peace talks extending supply chain disruption

Mumbai: Global oil prices edged higher on Thursday due to a stalemate over the next round of peace talks between the United States and Iran that kept the energy artery Strait of Hormuz effectively closed.

The June contract for Brent on the Intercontinental Exchange traded at $103.35 a barrel in morning trade, up around 4 per cent from the previous close. Meanwhile, the June futures contract for West Texas Intermediate on the New York Mercantile Exchange (NYMEX) rose 1.62 per cent to 94.47 a barrel.

Although US President Donald Trump extended the ceasefire until the leaders of the concerned countries came up with a “unified proposal”, he did not remove the naval blockade on Iran.

“US forces have directed 31 vessels to turn around or return to port as part of the US blockade against Iran,” US Central Command said on social media.

The strait has been shut for more than 50 days, disrupting nearly one fifth of global oil and gas supplies, with a sustained price rise having potential to impact India’s import bill and weigh on its economy, analysts said.

The government has maintained that retail fuel outlets across the country are operating normally.

Tehran’s negotiators will reportedly skip talks with the US, as negotiations were a “waste of time,” following which US Vice President JD Vance had paused his trip to join peace talks. Meanwhile, Iran’s navy also informed that it seized two container ships in the Strait of Hormuz.

Indian-flagged crude oil tanker Desh Garima, which crossed the Strait of Hormuz carrying 31 Indian seafarers, arrived in Mumbai on Wednesday.

The Indian basket price of crude that contains a derived mix of Sweet grade (Brent Dated) and Sour grade (Oman and Dubai average) stood at $102.46 per barrel as of April 21 and its average price in April stands at $115.8 per barrel.

IANS