Brent crude oil prices fell sharply by approximately 5% on Monday, driven by reports that the United States and Iran have paused military strikes over the weekend.
The sudden de-escalation in geopolitical tensions has removed a significant risk premium from energy markets, triggering a broad-based sell-off in oil futures.
5 points above the previous close, signaling a strong gap-up start for the Sensex and Nifty 50.
The drop in crude costs is expected to provide immediate relief to Indian equity markets, which have been under pressure from rising energy import bills.
The Gift Nifty, a key pre-market indicator for Indian benchmarks, was trading at a premium of nearly 127.5 points above the previous close, signaling a strong gap-up start for the Sensex and Nifty 50.
Asian markets broadly traded higher on the back of the improved risk sentiment.
This development marks a sharp reversal from recent weeks, where escalating hostilities in the Strait of Hormuz and surrounding regions had kept shipping routes exposed and pushed oil prices to multi-month highs.