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Crude oil prices edged higher on Thursday, as the market remained caught between easing immediate tensions and the looming threat of a persistent supply deficit in the Middle East. Brent crude futures were up $3.53 to $101.55 a barrel by 10:45 IST, while U.S. West Texas Intermediate (WTI) crude hovered near $92.46. The price action follows a highly volatile April, which saw Brent peak at $111 before retreating.

Brokerages View

Despite the recent price softening, Goldman Sachs maintained a "sharp upside scenario" in its latest note. While the bank nudged its Q2 Brent forecast down to $90 from $99 due to a reduction in the immediate risk premium, analysts warned that an extended closure of the Strait of Hormuz could drive prices to $120 per barrel by the third quarter.

"We continue to see the risks to our price forecast as skewed to the upside," Goldman Sachs commodity analysts wrote, noting that any failure in regional ceasefire talks could result in production losses of approximately 2 million barrels per day.

Shift To Deficit 

ANZ noted that global supply disruptions have materially tightened the crude balance. According to ANZ, the market has transitioned rapidly from an early-year surplus to a "sizeable deficit," a structural shift that is unlikely to disappear even with temporary diplomatic truces.

In the Indian context, Emkay Global analysts have pointed out that while the macro environment remains uncertain, the resilience in energy-related equities suggests that the "geopolitical risk premium" is now being baked into long-term valuations.

On India's Multi Commodity Exchange (MCX), crude oil for May delivery was trading at ₹8,948 per barrel. The strength in oil continues to weigh on the Indian Rupee and energy-intensive sectors, with the Nifty IT and Auto indices seeing notable pressure in early trade.