Crude Oil Prices: Will Trump-Brokered Iran-Israel Ceasefire Bring Stability? SBI Report Weighs In

Crude oil prices are now expected to hover around $65 per barrel, following a ceasefire announcement between Iran and Israel brokered by US President Donald Trump. The move has brought much-needed relief to volatile global energy markets, according to a recent research report by the State Bank of India (SBI).

The report emphasised that the trajectory of oil prices has been contingent upon how Iran would respond to recent tensions. In the same report, SBI had outlined three distinct geopolitical scenarios, each with varying implications for crude prices.

It is pertinent to note that Oil prices rallied more than 2% on Monday, June 23, after the United States launched targeted airstrikes on three Iranian nuclear sites—Fordo, Natanz, and Isfahan—heightening fears of a broader supply disruption in an already volatile Middle East.

The report, which has been cited across various publications, said the “de-escalation of hostilities” in the Middle East has pulled back the geopolitical risk premium that had kept oil markets on edge for weeks.

The report stated, "Different scenarios being built along the Iran-Israel conflict seem a little far-fetched, especially a worst-case scenario, on oil's trajectory, given that any sharp increase in prices may not be a long-term phenomenon."

Also Read: Oil Prices Surge Over 2% After US Strikes On Iran - Will You Pay More for Petrol in India? What You Should Watch | Republic World

Worst case scenario

The SBI report noted that in a more aggressive scenario — involving large-scale retaliation by Iran and a broader regional conflict — oil prices can skyrocket to $130–$140 per barrel. Such a spike, it warned, would have been highly disruptive for global trade and macroeconomic stability, particularly for economies heavily reliant on energy imports.

A middle-ground scenario would mean symbolic retaliation by Iran while maintaining active conflict with Israel, a situation that could have kept prices elevated in the $80–$90 range, as per the SBI report.

Meanwhile, Trump announced the ceasefire on Monday via a post on Truth Social, calling it a “complete and total ceasefire” agreed upon by both sides, set to take effect within six hours. The statement marks a significant cooling of tensions that had rattled markets over the past few weeks.

In the days leading up to the ceasefire, Brent crude had surged to around $79 per barrel, reflecting fears of a wider conflict. However, with diplomatic channels succeeding in reducing the temperature, global oil markets are now expected to regain stability.

“With world attention fixated to the Strait of Hormuz, the only sea route from the Persian Gulf to the open ocean, with ~20% of the world's oil transits passing through the troubled waterways, the needle has also moved to countries like us with a substantial dependency on oil imports since India imports nearly 90% of its crude oil requirements. About two million barrels per day of this, out of 5.5 million, transits through the Strait of Hormuz,” stated the SBI report.