- Brent falls sharply to around $93/bbl after US-Iran ceasefire
- Steel prices remain supported by tight domestic supply; exports, trade flows subdued
How will the ceasefire between the US and Iran reshape global metals markets? Following a two-week agreement to halt hostilities and restore stability around key shipping routes, BigMint presents a sharp update on the implications for the Indian metals, raw materials and energy markets:
Global energy markets have reversed sharply, with Brent crude falling nearly 15% to around $93/bbl after the US and Iran agreed to a conditional ceasefire and signalled a potential reopening of transit through the Strait of Hormuz, according to media reports.
The correction unwinds the supply shock-driven rally seen in March, with easing geopolitical risk expected to translate into lower fuel and freight costs if the ceasefire holds. Uncertainty persists around the durability of the agreement and the pace at which shipping flows normalise.
For India, the immediate impact is likely to be reflected in logistics and energy costs, which had remained elevated due to disruptions across the Strait of Hormuz and Red Sea corridors. Coal vessel rates have stabilised amid improved vessel availability and limited fixture activity, indicating a pause in earlier volatility alongside cautious cargo movement.
Domestic steel prices remain firm, supported by low inventories and constrained availability of key raw materials such as scrap and sponge iron. Mill inventory levels remain low, while buying activity has stayed healthy to moderate, sustaining upward price momentum despite limited improvement in demand.
Indian HRC export activity continues to see limited traction, as earlier disruptions led to vessel diversions, longer transit times and higher freight and insurance costs. Offers to Europe moved higher, but no firm bookings were reported, indicating weak conversion of demand into actual trade flows.
A sustained correction in oil prices could improve export competitiveness if freight costs follow through, but this will depend on how quickly shipping activity normalises and buyer confidence returns.
Imported scrap offers had risen during the conflict period due to elevated freight and supply disruptions, while domestic markets showed regional divergence, with northern prices strengthening on tight availability and improved buying interest, and western markets remaining largely stable.
With crude prices correcting, some moderation in freight-driven costs is likely, although the pass-through may remain gradual. Buying activity continues to be cautious, with procurement largely need-based after the recent price increase.
Coal markets are stabilising as cargo flows improve and freight pressure eases, with portside prices holding after earlier volatility. Softer demand signals are also visible through reduced fixture activity and weaker sentiment across bulk shipping markets.
Iron ore freight has seen selective increases on tighter tonnage in some routes but remains under pressure due to limited fresh demand, with overall activity levels still subdued.
Non-ferrous markets are showing early signs of easing supply tightness, with improved availability of material from the Middle East beginning to normalise supply conditions, although demand remains cautious and price movements continue to be supply-driven.
Jindal Steel’s expansion of coal gasification capacity reflects a broader push to reduce exposure to imported fuels and improve cost stability. The company is scaling the use of syngas across steelmaking processes, building on its earlier deployment of India’s first coal gasification-based DRI unit in 2014.
While lower oil prices are expected to ease cost pressures across energy and logistics chains, but steel price direction will continue to be driven by domestic supply conditions and the pace of recovery in export demand.
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