Oil Below $95 on US-Iran Pause; Asian Paints, MRF Rally
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- Trump announced a two-week pause in US attacks on Iran and described Iran's 10-point proposal as a 'workable basis' for negotiations, posting on Truth Social that the US had 'met and exceeded all military objectives'
- Iran agreed to allow safe passage through the Strait of Hormuz for two weeks, with its Supreme National Security Council saying negotiations with the US would begin on April 10 in Islamabad, though it stressed the talks do not signal an end to the war
- Brent crude futures dropped more than 13% to $94.98 per barrel while WTI crude fell over 15% to $95.95 per barrel as of 9am IST on Wednesday, reversing a surge that had pushed prices above $100 in March
- Asian Paints shares rose nearly 7% to Rs 2,336.9 apiece, Indigo Paints surged 9%, and Berger Paints gained around 5% as paint makers, which use crude as a key raw material, saw margin pressure concerns ease
- MRF, India's most expensive stock, rose 6% while Apollo Tyres and CEAT also advanced more than 6%, with tyre companies also benefiting from the crude price drop
- Pakistan brokered the ceasefire, with Iran's foreign minister thanking Pakistani leadership on behalf of the Supreme National Security Council for facilitating the talks
- Harshal Dasani of INVasset PMS noted that nearly 20 million barrels per day, or about 20% of global oil flows, pass through the Strait of Hormuz, explaining the scale of the price recalibration
Why it matters: Indian paint and tyre companies, which use crude oil as a key raw material, saw shares rally 5-9% after oil fell below $95 on the US-Iran ceasefire. With over 40% of India's crude imports coming from the Middle East, the temporary Strait of Hormuz reopening eases imported inflation pressure—but with only a two-week window and Iran cautioning the talks do not end the war, the relief could prove short-lived.
