US-Iran war: Oil prices gained on Wednesday, 3 June, amid growing doubts over the likelihood of a peace agreement between the US and Iran, while renewed hostilities in the Middle East further heightened supply concerns.
Brent crude futures climbed toward $97 per barrel, while West Texas Intermediate (WTI) hovered near $95, after gaining more than 7% during the first two trading days of the week.
Back home, crude oil prices on the Multi Commodity Exchange (MCX) also witnessed a similar upward movement, tracking global prices. MCX crude oil price rose as much as 1% to ₹9,039 per barrel.
What’s driving crude oil prices today?
Israel has continued its strikes on Lebanon, casting uncertainty over delicate and prolonged diplomatic efforts between Washington and Tehran, even as Iran launched missiles toward neighboring countries.
A fresh round of negotiations between Israel and Lebanon is set to take place on Wednesday. US President Donald Trump expressed confidence that Washington and Tehran could soon reach an interim agreement, dismissing reports from Iranian state media suggesting that talks had been halted because of the ongoing conflict in Lebanon, according to a Bloomberg report.
Uncertainty surrounding a possible extension of the current ceasefire and the resumption of shipments through the Strait of Hormuz has fueled volatility in oil markets. Prices, which declined last month on hopes of a diplomatic breakthrough, are now facing renewed pressure as delays raise concerns that global crude stockpiles may need to be drawn down further while Persian Gulf exports remain constrained.
At the same time, tensions in the Middle East have intensified. Iran launched ballistic missiles toward Kuwait and Bahrain, though the projectiles either broke apart mid-flight or were intercepted. Meanwhile, US forces carried out strikes on Iran’s Qeshm Island, according to a statement from US Central Command on X.
According to an ABC News report, Trump is seeking written commitments from Iran on specific nuclear concessions as part of a preliminary agreement aimed at ending the conflict. The report added that Tehran had previously provided verbal assurances regarding certain aspects of its nuclear program.
Crude oil price outlook
Anindya Banerjee, Head of Commodity and Currency Research, Kotak Securities, believes that May was Brent’s worst month since the Covid pandemic, down around 19% and off about 20% from its 2026 peak, almost entirely on deal hope.
“Near term, it stays binary: a credible US–Iran deal reopens the strait and drags Brent towards the $70s, while a hardened deadlock — or a Red Sea flare-up — pushes it past $130 as inventories run low through the summer. At around $95, the market is still pricing a deal it does not yet have,” Banerjee said.
On the technical outlook, Ponmudi R, CEO of Enrich Money, said that MCX crude oil price is trading above the ₹8,500 level, staging a technical bounce near the lower end of the ascending trendline structure that continues to provide structural support, with MACD and broader technical indicators suggesting a weakening of bearish momentum on the daily timeframe.
“Immediate resistance stands at ₹8,625– ₹8,650; a sustained move above this zone could trigger a recovery toward ₹8,700– ₹8,770. On the downside, ₹8,450– ₹8,390 acts as immediate support; a break below this area could extend the decline toward ₹8,300– ₹8,250. The near-term bias remains cautious, with direction largely driven by ongoing geopolitical developments,” Ponmudi said.
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