Crude oil Oil prices drops below USD 90 mark after IEA amid global turmoil

Representational image. File pic

Crude oil prices, on the second day in a row, declined after reports surfaced that the International Energy Agency (IEA) proposed the largest release of emergency reserves in its history to cool the price surge fuelled by the US‑Iran war.

As reported by news agency IANS, the proposed release would surpass the 182 million barrels deployed in two tranches in 2022 following Russia's invasion of Ukraine, according to multiple reports. T

The Group of Seven (G7) nations have asked the IEA to prepare scenarios for such a move, reports said.

Crude oil trades at USD 86.93

The Brent crude oil price fell 0.99 per cent to USD 86.93 a barrel, while US West Texas Intermediate (WTI) futures dropped 0.75 per cent to USD 82.82, as per IANS.

Overnight, both futures had settled down more than 11 per cent, marking the steepest single-day decline in four years.

Brent prices had surged nearly 50 per cent since January after the closure of the Strait of Hormuz, a strategic passageway that handled about one‑fifth of global oil flows. The disruption left tankers stranded, filled up storage capacity and forced producers to cut output, driving energy costs higher.

Before the sudden decline due to the West Asia War, the oil prices had earlier touched USD 120 as traders reacted to comments from US President Donald Trump suggesting the conflict could end soon.

West Asian war enters second week

The US-Iran war entered its second week with no signs of resolution in sight. In a recent development, US President Donald Trump had warned Iran against placing mines in the Strait of Hormuz following reports of Iran having already done so or being in preparation.

President Trump, while taking it to the social media platform TruthSocial, said, "If Iran has put out any mines in the Hormuz Strait, and we have no reports of them doing so, we want them removed immediately!" Trump further added that removing the mines would be "a giant step in the right direction!"

The conflict's economic impact is already being felt in the United States, where gasoline prices have begun rising sharply.

Meanwhile, a group of US lawmakers has introduced legislation that would temporarily suspend the federal gasoline tax to ease pressure on households.

(With inputs from IANS)