Global Oil Market Drops Sharply After Trump’s Statement, Petrol and LPG Prices Could Fall

New Delhi: Relief news emerged on Monday amidst the tension that has been going on for several months in West Asia. After the announcement of peace agreement between America and Iran, a big fall in the prices of crude oil was recorded in the international market. Due to this, there may be less pressure on the prices of petrol, diesel and LPG in many countries including India in the coming days.

What did Trump claim?

US President Donald Trump claimed that the deal with Iran has been completed and the Strait of Hormuz, one of the world's most important oil routes, will be reopened. Along with this, the removal of the American naval blockade was also announced.

As soon as the news of the agreement came, there was a rapid reaction in the oil market. Brent crude fell nearly 4 per cent to around 84 dollars a barrel, while US WTI crude fell nearly 5 per cent to around 81 dollars a barrel. This is considered to be the lowest level since March.

Why is the Strait of Hormuz important? 

The Strait of Hormuz is considered very important for global energy supply. About 20 percent of the world's oil and LNG is transported through this route. For the last few months, oil supply had been being affected due to the disruption, due to which the prices had crossed 100 dollars per barrel.

Experts believe that if the agreement is implemented on time and oil supply becomes normal, there may be further pressure on prices in the global market. This will also affect importing countries like India, where the possibility of relief in the prices of petrol, diesel and LPG will increase.

What is Shahbaz Sharif's stance on this?

According to Pakistan Prime Minister Shahbaz Sharif, this agreement between America and Iran will be formally signed in Switzerland on June 19. The agreement includes important points like ceasefire, restoration of oil supply and reducing regional tension.

At present, the eyes of the global market are fixed on the signing ceremony to be held on June 19. If the agreement is successfully implemented, stability could return to the energy market and consumers could get relief from fuel prices.