Crude oil prices may have cooled from their recent highs as geopolitical tensions begin to ease, but a return to pre-conflict levels is still unlikely in the near term, according to Probal Sen from ICICI Securities. While markets have welcomed signs of progress in peace negotiations, uncertainty surrounding the final outcome means oil is likely to retain a risk premium.
Sen believes the market has already priced in some of the optimism. However, shipping disruptions, elevated insurance costs and higher freight charges could continue to keep crude prices in a relatively higher trading band over the coming months.
