Rupiah strengthens as oil prices fall on Middle East peace hopes

Chief Analyst at Doo Financial Futures Lukman Leong told ANTARA here on Wednesday that the rupiah was supported by declining global crude oil prices amid growing hopes for peace in the Middle East.

“The rupiah has the potential to strengthen against the US dollar as global oil prices decline amid growing prospects for peace in the Middle East, following reports that Iran and Oman discussed establishing a temporary joint maritime corridor in the Strait of Hormuz,” he said.

As reported by Xinhua, Omani Foreign Minister Sayyid Badr bin Hamad Al Busaidi and Iranian Foreign Affairs Minister Seyed Abbas Araghchi discussed efforts to restore freedom of navigation through the Strait of Hormuz.

The two top diplomats discussed developments in shipping through the strategic waterway and underscored the need to continue talks to reach a practical understanding that would ensure smooth and uninterrupted navigation while supporting regional security and stability.

They also reviewed recent developments in the region and measures to create conditions for dialogue and negotiations to resume, with the aim of bridging differences and peacefully resolving outstanding issues.

Amid geopolitical shifts in the Middle East, Anadolu reported that Brent crude fell to around US$86.20 per barrel, extending its previous session’s 2.4 percent decline. West Texas Intermediate (WTI) also fell 5.5 percent to settle near US$80.40 per barrel.

On the domestic front, Lukman assessed that there were no significant factors influencing the rupiah’s movement, although investors would closely monitor planned protests on Thursday (August 27). Based on these factors, the rupiah is forecast to trade within a range of Rp17,650 to Rp17,750 per US dollar.

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Translator: M Baqir, Raka Adji