Oil Prices Fall 2% as Trump Delays Iran Action; Markets Brace for Volatility

Oil Prices Fall 2% as Trump Delays Iran Action; Markets Brace for Volatility​

Brent crude oil prices fell nearly 2% on Friday amid de-escalation talks in the Middle East. Checkout today’s crude oil price movements, along with experts’ take on the near-term outlook.

The Israel-Iran war is impacting oil prices. US President Donald Trump has once again extended the deadline related to action against Iran’s energy sector, providing short-term relief to financial markets while extending uncertainty over how the conflict may unfold into April.

Brent crude fell as much as 2% to slip below $106 per barrel on Friday after having surged nearly 6% in the previous session, while West Texas Intermediate hovered around $93 a barrel.

Back home, crude oil prices on the Multi Commodity Exchange (MCX) also witnessed a similar downtrend. MCX crude oil prices fell 1.31% to ₹8,879 per barrel.

Trump’s Delay and Military Build-Up​

Trump said that although Tehran had sought a seven-day window, he granted a 10-day extension, pushing the revised deadline to April 6. This extension provides additional time for diplomatic negotiations and enables the US to build up its military presence in the region. Sources quoted as saying by Reuters indicate that this deployment already includes Marine Expeditionary Units and troops from the Army’s 82nd Airborne Division. The Pentagon is also considering deploying as many as 10,000 more ground troops, according to The Wall Street Journal.

Iran’s Stance and Strait of Hormuz​

Iran said on Thursday, as quoted by Tasnim News Agency, that it is awaiting a response after rejecting a 15-point US proposal to end the war and putting forward its own terms. These include recognition of Tehran’s control over the Strait of Hormuz, a crucial route linking the Persian Gulf to global markets. Before the conflict began in late February, the key waterway accounted for roughly one-fifth of global oil shipments. Despite the broader stalemate, there has been a slight uptick over the past day in Iran-linked vessels — mainly bulk carriers and LPG ships — attempting to transit the passage.

Expert Analysis​

Kaynat Chainwala, AVP - Commodity Research, Kotak Securities, noted, “Iran’s foreign minister has indicated that a U.S. proposal is under consideration but has ruled out direct negotiations, while President Trump has continued to urge Tehran to take a more serious approach toward a deal. Ongoing mixed signals from both sides suggest that any resolution is likely to be gradual, keeping market volatility elevated in the near term.”

Brent crude is on track for a record monthly surge in March, driven by the conflict involving the US, Israel, and Iran. With Tehran effectively forcing the near-total shutdown of the Strait of Hormuz, the war has significantly disrupted critical energy supplies to the global economy.

Outlook for Crude Oil Prices​

Brent crude is currently holding above $107 per barrel, keeping the Brent–WTI spread elevated well above $10 per barrel, significantly higher than its typical low single-digit range, reflecting a stronger premium on seaborne crude. “Overall, crude oil markets remain highly sensitive to geopolitical developments, with persistent volatility driven by uncertainty around U.S.–Iran relations and the absence of a clear de-escalation pathway,” Chainwala added.