Crude Futures Plummet as US-Iran Talks Revive Hopes for Supply Disruptions

Crude oil futures on the Multi Commodity Exchange (MCX) plummeted to their weakest level since July 14, hitting a three-week low of Rs 7,563 per barrel on Monday. The August delivery contract fell by Rs 583, or 7.2%, to Rs 7,530 per barrel.

The decline was largely driven by renewed hopes of US-Iran negotiations, which eased concerns over supply disruptions from West Asia. US President Donald Trump's statement that talks with Iran would resume sparked a sharp decline in global oil benchmarks.

The West Texas Intermediate (WTI) futures slipped $5.89, or 7%, to $78.78 per barrel on the New York Mercantile Exchange. Brent oil futures for October delivery plunged $6.38, or 7.3%, to $81.55 per barrel on the Intercontinental Exchange.

Aamir Makda, Commodity & Currency Analyst at Choice Broking, noted that the August crude oil futures on MCX resumed trading around the Rs 7,500-per-barrel level and declined to hit the lower circuit limit during intra-day trade.