Petrol-Diesel Rates: Following a peace agreement between the US and Iran, the blockade on the Strait of Hormuz is set to be lifted; previously, ships had to pay around $2 million to pass through it.

Relief on Fuel Costs: Fuel prices had been steadily rising over the past few months due to tensions in West Asia, but a slowdown is now expected. Crude oil prices have dropped significantly following US President Donald Trump's announcement of a historic peace deal with Iran and the decision to reopen the Strait of Hormuz without tolls.

Late Sunday night, Brent crude fell 3.9% to $84 per barrel, while US crude dropped 4.8% to approximately $81 per barrel. These are the lowest levels seen since March.

Why is the Strait of Hormuz so crucial?

The Strait of Hormuz is a strategic maritime route through which the majority of the world's oil shipments pass. It had been closed since late February following attacks on Iran by the US and Israel. According to an Iranian MP, some commercial vessels used to pay an average of around $2 million to transit this waterway.

Experts had warned that if the disruption in the strait continued, oil prices could surge to the mid-to-high $100 range, and US gasoline prices could hit record highs. This is why the world was eagerly awaiting an agreement between the two nations—an agreement that has finally materialized. As soon as Trump announced the deal, crude oil prices saw a sharp decline.

How does India benefit?

India imports over 85% of its crude oil requirements. The reopening of the Strait of Hormuz will reduce India's import bill and lower transportation costs. Impact on Petrol, Diesel, and LPG Prices

India's Minister of Petroleum and Natural Gas, Hardeep Singh Puri, stated that oil and gas prices are expected to decrease in the coming months. Petrol and diesel prices had previously risen by approximately 8–8.5% due to the conflict between Iran and the US. Now, with crude oil prices settling around the $80 mark, companies could soon reduce prices by ₹3–5 per litre; however, no official announcement has been made yet. Similarly, the prices of LPG cylinders may also come down.