Explainer: Why are global oil prices going up? What does this mean for India?
What is the current global oil price? The global oil prices are high at this point. Two days ago, Brent crude price touched $90 a barrel—the highest in seven years. Prices are likely to remain high. According to some projections, oil prices could go beyond $100 per barrel. Why should the high global price worry India? India imports over 85 per cent of its oil requirements. If global prices increase, India’s import bill goes up. While high crude oil prices have always been a cause for concern for Indian policymakers, it is particularly worrisome amid the ongoing Covid 19 pandemic. As India expanded its expenditure to support the economy, room to absorb such shocks has reduced. Higher global oil prices would make petrol and diesel more expensive, which in turn will have an impact on inflation, something India needs to be watchful about. Read More