Brent crude prices have been on a downward trend for 3 consecutive weeks, marking a steady decline as war premiums deflate. On Friday brent crude fell to roughly $72.00 to $73.00 per barrel, returning to levels last seen prior to the recent escalations involving Iran, US and Israel.
Where as West Texas Intermediate (WTI) dropped to $69.00 to $70.00 per barrel range, reflecting a drop of over 2-3% during the session.
Following the announcement of peace talks between Iran and US, there has been considerable drop in crude prices, removing the geopolitical risk premium that had driven prices up to nearly USD 120 per barrel at the height of the conflict earlier this year.
Both benchmarks have returned to levels last observed in late February, prior to the outbreak of hostilities that unsettled energy markets in the Middle East.
Although crude oil prices have dropped sharply, retail fuel prices stayed unchanged on Friday.
During the recent surge in Brent crude prices, the Union government increased petrol and diesel rates by Rs 7.50 per litre each, but state-owned fuel retailers have not yet reduced pump prices, according to industry data.
The cost of crude has been moving sharply lower since the US and Iran signed a Memorandum of Understanding (MOU) on 17 June which set out a 60-day period for negotiations on Tehran's nuclear programme and other measures to end the war.
While there are no official figures on the under-recoveries incurred by oil marketing companies from selling petrol, diesel, and LPG, the government estimated earlier this month that their daily losses were approximately Rs 700 crore. With the sharp decline in crude oil prices, these losses are expected to fall significantly.
It is yet to be seen when the government will transfer the benefit of declining crude oil prices to retail consumers.
India's provisional headline Consumer Price Index (CPI) inflation increased to a softer-than-anticipated 3.93% in May 2026, compared with 3.48% in April.
India’s provisional wholesale price index (WPI) inflation surged sharply to 9.68% in May 2026 under a newly updated 2022-23 base year series released by the Ministry of Commerce and Industry.
This multi-month high was driven overwhelmingly by a massive 30.33% spike in the wholesale fuel and power segment, resulting from global crude oil and natural gas supply shocks linked to the West Asia conflict earlier in the month.
In India, fuel prices are not revised in line with daily fluctuations in global crude markets.
Instead, they are generally determined by the average oil prices over the previous two weeks or month. Consequently, any advantage from the recent decline in crude prices may take time to show up at fuel stations, and only if the lower international rates persist.
