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Informist, Wednesday, Aug. 5, 2026

 

By Ashutosh Pati

 

MUMBAI – Crude oil's volatile run over the past few months is likely to continue into August, or at least until there is a lasting resolution to the war in West Asia, analysts said. They expect prices to be in a broad range during the month as market sentiment shifts with developments in talks over a peace deal between the US and Iran.
 

The August crude oil contract on the Multi Commodity Exchange of India is seen at INR 7,160-INR 8,475 per barrel this month, as per the median of estimates from 10 brokerages polled by Informist. The September contract of WTI crude oil on the New York Mercantile Exchange is seen between $75 and $90 per barrel this month.

 

After falling to a low of $67 per barrel in early July, West Texas Intermediate crude oil prices surged back above $80 per barrel as shipping through the Strait of Hormuz remained disrupted. US Treasury Secretary Scott Bessent said the US and Iran could reach a deal Tuesday or Wednesday to reopen the Strait of Hormuz with freedom of movement for commercial ships, CNBC reported. Following this, WTI crude oil prices plunged over 5% to a one-month low of $74.24 per barrel.

 

However, uncertainty prevails in the market as peace talks between the two nations have failed several times. Moreover, Iranian officials continue to deny that any negotiations are underway. "As talks progress, oil (price) is likely to drop further. However, considering the pointers of negotiations, it may not go successfully and oil may rebound later in the month," Jigar Trivedi, senior analyst at IndusInd Securities, said.

 

Crude oil prices declined for three consecutive days on hopes of a deal but are slightly higher Wednesday. "There are suggestions that a deal could be announced as soon as today (Wednesday), although reports that any agreement would be temporary suggest that the market would be wise not to get too carried away," Warren Patterson, head of commodities strategy at ING Economics, said in a note.

 

There are still clearly sharp differences between the US and Iran on the management of the Strait of Hormuz, and, of course, the nuclear issue. "Therefore, there is the very real risk that any deal unravels fairly quickly, as we saw with the Memorandum of Understanding. For now, tanker movements through the Strait of Hormuz remain highly constrained and so the global oil market continues to tighten," Patterson said.

 

At 1419 IST, the most-active September WTI crude oil on the NYMEX traded 0.7% higher at $76.26 per barrel. The August crude oil contract on the domestic bourse was 0.8% higher at INR 7,270 per barrel.

 

A sustained rise above $80 per barrel would require physical evidence of disruption, such as constrained shipments or inventory drawdowns, rather than headlines alone, an analyst at a domestic brokerage said. "For Indian investors, MCX crude combines WTI exposure with USD/INR. The upside tail is a logistics shock; the downside catalyst is supply normalisation," the analyst said.

 

Meanwhile, seven members of the Organization of the Petroleum Exporting Countries and its allies Sunday agreed to raise crude oil production by 188,000 barrels per day in September. With this increase, the group has fully unwound the additional voluntary cuts announced in April 2023.

 

"However, due to the ongoing blockade of oil exports through the Strait of Hormuz, actual oil production by the Gulf states remains well below the agreed level," Carsten Fritsch, commodity analyst at Commerzbank AG, said in a report. "Consequently, the agreed increase in supply has so far been only on paper. For it to actually take effect, the transport of oil through the Strait of Hormuz would have to be possible again without any restrictions. So far, this has not been the case," he added.

 

If the deal between the US and Iran holds and oil flows from the Persian Gulf normalise, the market's attention will immediately turn to the supply and demand balance in the fourth quarter of 2026 and for 2027. "A recovery in Persian Gulf supplies, stronger OPEC+ output following on-paper supply increases through the war, and UAE (United Arab Emirates) supply increases all point towards a very comfortable balance sheet in 2027. However, a large part of the expected surplus next year will be absorbed by restocking demand," Patterson said.

 

Market participants will closely monitor the monthly reports of the US Energy Information Administration, the International Energy Agency, and OPEC. IEA said in July that global oil demand was recovering from the rock bottom seen in May. However, global oil demand for 2026 is projected to decline by 1 million barrels per day before rebounding by 2 million barrels per day in 2027. The agency also said while global oil supply had bounced back, it was still well 9.4 million barrels per day below the pre-war levels.

 

Following is a summary of the poll by Informist on crude oil prices for August and details of the estimates by respondents:

 

Brokerage	MCX support (in INR)	MCX resistance (in INR)	NYMEX WTI support ($)	NYMEX WTI resistance ($)
Arthavrksh Financial Services	7,200	8,400	75	87
ICICI Direct	6,800	8,800	--	--
IndusInd Securities	7,400	8,300	72	88
Kotak Securities	7,300	8,200	75	90
LKP Securities	7,000	8,200	75	85
Nirmal Bang Securities	7,120	8,590	75.4	92
Prithvi Finmart	7,200	8,550	74	90
SMC Global	6,500	9,000	72	90
Smallcase	6,500	7,700	68	80
Ventura Securities	7,200	8,600	75	90
Median	7,160	8,475	75	90

End

 

US$1 = INR 95.15

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Saji George Titus

 

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