On Monday 7 March, the price of crude oil had come down from $ 139.13 per barrel to a low of $ 97 per barrel on 17 March. A week before this, the price of crude oil was almost at a 14-year high due to the ongoing war between Russia and Ukraine.
From 24 February 2022, there was a huge upside in crude prices due to the Russia-Ukraine war. Compared to last year, the price of crude oil had increased by more than 40% in the last 2 months.
The price of $ 147.4 per barrel has been the highest price in the history of crude oil. A few days ago, American Diplomat Wendy Sherman said that Russia had indicated that it may be ready to talk to Ukraine.
Its positive impact has been seen in the price of crude oil and since then some softening is also visible in it.
This is the biggest fall in the price of crude oil since November 2021. Due to the imposition of sanctions on the import of Russian crude oil by America and the European Union, many analysts believe that even if the crude price falls, it is difficult to stay below $100 per barrel for long.
Ever since Russian President Putin announced the invasion of Ukraine, the chances of impacting energy exports have increased, which are now becoming visible. Russia is the world’s 2nd largest crude oil producer and 3rd largest exporter.
Which majorly exports oil to other European refineries. Major European countries import more than 20% of crude oil from Russia.
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In addition, Russia produces almost 10% of the world’s copper and aluminum. According to a report, Russia is the world’s main exporter of crude oil and related products, which ships approximately 7 million barrels per day.
In a recent report, experts have estimated that if the war between Russia and Ukraine progresses further, then the price of crude oil can reach up to $185 per barrel.
And if said, whenever there is a change of even 1 dollar in the price of international crude oil, then there is a change of 50 to 60 paise in the price of petrol and diesel in India.
In such a situation, due to reduced production and interruption in supply, the price of crude oil may increase.
According to the report, if the price of crude oil reaches $ 150 per barrel, then the price of petrol and diesel in India may also increase by 14 to 20 rupees. But experts also say that this rising price can be seen not immediately but gradually in a few days.
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How does the volatility of crude oil prices affect India?
We all know that international crude oil prices have kept rising and even after that petrol and diesel prices in India is stable for 3 to 4 months. In such a situation oil companies have to face heavy losses.
India is the biggest crude oil importer which imports about 85% of the crude oil and the price of which India has to pay in US dollars.
And in such a situation, if the price of crude oil increases and the dollar continues to strengthen, the price of petrol and diesel can also increase. And this will increase India’s import bill and fiscal deficit as well.
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This article is only for education purpose and the author has his own views and research, so if you invest in these stocks/forex/Virtual Digital Asset then do it at your own risk and do the research yourself before investing.
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FAQs about Crude oil
The price of $ 147.4 per barrel has been the highest price in the history of crude oil.
India is the biggest crude oil importer which imports about 85% of the crude oil.