Petrol, Diesel Prices Hold Steady As Crude Falls Below $79 After U.S.-Iran Deal

Petrol and diesel prices remained unchanged on June 18, even as international oil prices extended their decline after the U.S. and Iran formalised a peace agreement that paved the way for the reopening of the Strait of Hormuz.

State-run oil marketing companies (OMCs) have kept retail fuel prices unchanged since the latest revisions carried out in May. The companies had absorbed a large portion of the impact arising from volatile crude prices before implementing a cumulative increase of around ₹7.50 per litre through multiple revisions.

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The first increase of ₹3 per litre came into effect on May 15, marking the first upward revision in more than four years. Three additional adjustments followed over the next 10 days.

Fuel Prices In Major Cities On June 18

Crude Oil Continues To Ease

Global oil prices extended losses after the announcement of a peace accord between the U.S. and Iran. Brent crude futures fell 1.12%, or 89 cents, to $78.66 per barrel after news emerged that shipping operations through the Strait of Hormuz would gradually return to normal.

The waterway, a critical route for global energy trade, had been at the centre of supply concerns in recent months. Disruptions in the region had pushed up crude oil prices and added pressure on fuel retailers.

Under the agreement, traffic through the strait is expected to be fully restored within 30 days, according to details released following the accord.

Rupee Strengthens As Oil Prices Decline

Lower crude prices also supported the domestic currency. The rupee appreciated by 10 paise to close at 94.50 against the U.S. dollar on Wednesday.

According to PTI, Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan, said softer crude prices, a weaker U.S. dollar and lower U.S. Treasury yields could provide support to the rupee.

Although international oil prices have retreated below $79 a barrel, retail fuel prices in India remain unchanged for now. Any further revisions by OMCs would be contingent on the sustainability of crude prices and the wider trends in global energy markets.