The crude oil prices are overheated due to the war-like situation in West Asia, the main trade gate of oil in the world. The prices have breached the psychological barrier of $100 per barrel in almost four years.
Brent crude touched $114 a barrel when trading resumed on the Chicago Mercantile Exchange on Monday, a 23% jump from its Friday closing price of $92.69.
The Oil prices are now about 50% higher than they were before the United States and Israel launched attacks on Iran on Feb 28, 2026
According to independent research firm Rystad Energy, about 15 million barrels of crude oil, roughly 20% of the global supply, normally pass each day through the Strait of Hormuz.
Iraq, Kuwait and the United Arab Emirates have reduced oil production as storage tanks fill up due to limited exports.
The last time Brent and US crude futures were close to current levels was in 2022, after Russia launched its invasion of Ukraine.
At 3:10 pm, crude oil is trading at $98.76 per barrel, and Brent is trading at $102.65 per barrel.
Uppal Shah, MD and Founder of JK India eAgriTech, said, “The high oil prices are bad news for every country, as it threatens to hike up domestic inflation. We are at a critical juncture with the escalating tension. The US has given a 30-day waiver to India to procure crude from Russia, which is a much-needed breather. However, de-escalation of the tension is the need of the hour for trade and peace to get restored”.
Historically, rising crude oil prices have been shown to have an inverse relation on sugar production. When crude oil prices increase, petrol becomes expensive, making ethanol more competitive. Sugar mills in Brazil, divert more sugarcane or molasses toward ethanol production instead of sugar. This could give a narrow window of opportunity to Indian mills to export sugar to importing nations.
“For the 2025-26 season, Brazilian mills initially prioritised sugar production, with the sugar mix peaking at nearly 55% in the second half of August. However, with sugar now trading at a discount to ethanol, the diversion towards sugar is likely to moderate, with the sugar mix expected to hover around 48% in the upcoming season”, Shah said.
