Know why soon petrol and diesel to be cheaper by Rs 5 to 6 per liter?
Monday - March 9, 2020 1:38 pm ,
Category : WTN SPECIAL
Crude oil prices fell by nearly 30 percent
Petrol-diesel not to be cheap as expected in India even after the price war between Saudi Arabia and Russia
MARCH 09 (WTN) - For a fast developing country like India, low crude oil prices mean a lot. In fact, India imports close to 80 percent of its oil requirement. As you know that most of the trades in international trade are done in US dollars, in such a situation, India has to spend a lot of US dollars for the import of crude oil. Keeping the prices of crude oil under control is very important for the Indian economy. This is why because due to the increase in the prices of crude oil, Indian oil companies will also have to import crude oil at expensive rates. Now, the oil companies will import crude oil at expensive rates; it is natural that the oil companies will increase the prices of petrol and diesel domestically.
At the same time, when the price of diesel increases, it will also increase transportation costs. And with the increase in transportation costs, inflation will increase due to the expensive transportation of everyday items. That is, it is clear that the relation of inflation in India is dependent on the prices of crude oil in the international market. For your information, let us know that the determination of the prices of crude oil is a very sensitive matter. Any event that occurs in the Gulf exporting countries or any fluctuations in diplomatic relations with other Gulf countries affects the price of oil. As you are aware that recently, the apprehension of war between Iran and America was at a peak, then there was a huge jump in the prices of crude oil, and this is why petrol-diesel became expensive in India.
But as far as the prices of crude oil are concerned, so for your information, let us know that, at present, there is a steep decline of about 30 percent in the price of crude oil in the international market. Now, you must be wondering why there has been such a sudden drop in the prices of crude oil? So for your information, let us know that this big drop in crude oil prices has come due to the price war between Saudi Arabia and Russia. Let us know that this is the biggest drop in the prices of crude oil since 1991. However, apart from the ongoing price war between Saudi Arabia and Russia, the global demand for oil due to the Coronavirus infection has also led to such a steep decline in prices.
First of all, let us tell you why the price war between Saudi Arabia and Russia has started? Indeed, Saudi Arabia, which is the world's largest oil exporter, wants to teach a lesson to Russia, the world's second-largest oil-producing country, because Russia has refused the proposal of oil production proposed by the Organization of Petroleum Exporting Countries (OPEC). Let us know that OPEC and other oil-producing countries supported the reduction in oil production to stabilize the falling prices of crude oil due to the economic decline caused by the Coronavirus outbreak, but Russia refused to reduce oil production. Actually, even after the demand for oil has reduced, the supply of oil remains the same. In such a situation, there was a meeting among the oil-exporting countries' organization OPEC and other allies about oil production cuts, but Saudi Arabia alleges that due to the obstinate attitude of Russia, no agreement was reached on the oil production cuts in the meeting. Resenting this attitude of Russia, Saudi Arabia immediately announced a huge cut in crude oil prices.
Saudi Arabia has cut crude oil prices to teach Russia a lesson; Saudi Arabia has cut its official sales quota for April by 6 to 8 dollars per barrel for all crude grades. Naturally, this big move by Saudi Arabia has raised the possibility of a price war in the international oil market. International benchmark Brent crude futures were down 31.5 percent to $ 31.02 a barrel after Saudi Arabia's decision to cut crude oil prices. For your information, let us know that this is the biggest drop in the prices of crude oil since the first Gulf War started on January 17, 1991, and February 12, 2016. At the same time, American West Texas Intermediate crude prices also fell by 27.4 percent to $ 30 a barrel. Explain that this is the biggest drop in the prices of American West Texas Intermediate crude after the first Gulf War.
Now, the price of crude oil has fallen by about 30 percent, petrol and diesel can be cheaper in India by around Rs 5 to 6 per liter. However, some people think that as the price of crude oil has fallen by almost 30 percent in the international market, the prices of petrol and diesel in India may be even lower. But according to experts, the price of petrol-diesel in India will not decline much as the Indian currency rupee is currently weak against the US dollar. But the reduction in the price of petrol and diesel from Rs 5 to 6 per liter will also be a relief for the Indian economy for some time; and due to such a fall in the price of petrol and diesel, a common Indian citizen will get relief for some time from inflation.
MARCH 09 (WTN) - For a fast developing country like India, low crude oil prices mean a lot. In fact, India imports close to 80 percent of its oil requirement. As you know that most of the trades in international trade are done in US dollars, in such a situation, India has to spend a lot of US dollars for the import of crude oil. Keeping the prices of crude oil under control is very important for the Indian economy. This is why because due to the increase in the prices of crude oil, Indian oil companies will also have to import crude oil at expensive rates. Now, the oil companies will import crude oil at expensive rates; it is natural that the oil companies will increase the prices of petrol and diesel domestically.
At the same time, when the price of diesel increases, it will also increase transportation costs. And with the increase in transportation costs, inflation will increase due to the expensive transportation of everyday items. That is, it is clear that the relation of inflation in India is dependent on the prices of crude oil in the international market. For your information, let us know that the determination of the prices of crude oil is a very sensitive matter. Any event that occurs in the Gulf exporting countries or any fluctuations in diplomatic relations with other Gulf countries affects the price of oil. As you are aware that recently, the apprehension of war between Iran and America was at a peak, then there was a huge jump in the prices of crude oil, and this is why petrol-diesel became expensive in India.
But as far as the prices of crude oil are concerned, so for your information, let us know that, at present, there is a steep decline of about 30 percent in the price of crude oil in the international market. Now, you must be wondering why there has been such a sudden drop in the prices of crude oil? So for your information, let us know that this big drop in crude oil prices has come due to the price war between Saudi Arabia and Russia. Let us know that this is the biggest drop in the prices of crude oil since 1991. However, apart from the ongoing price war between Saudi Arabia and Russia, the global demand for oil due to the Coronavirus infection has also led to such a steep decline in prices.
First of all, let us tell you why the price war between Saudi Arabia and Russia has started? Indeed, Saudi Arabia, which is the world's largest oil exporter, wants to teach a lesson to Russia, the world's second-largest oil-producing country, because Russia has refused the proposal of oil production proposed by the Organization of Petroleum Exporting Countries (OPEC). Let us know that OPEC and other oil-producing countries supported the reduction in oil production to stabilize the falling prices of crude oil due to the economic decline caused by the Coronavirus outbreak, but Russia refused to reduce oil production. Actually, even after the demand for oil has reduced, the supply of oil remains the same. In such a situation, there was a meeting among the oil-exporting countries' organization OPEC and other allies about oil production cuts, but Saudi Arabia alleges that due to the obstinate attitude of Russia, no agreement was reached on the oil production cuts in the meeting. Resenting this attitude of Russia, Saudi Arabia immediately announced a huge cut in crude oil prices.
Saudi Arabia has cut crude oil prices to teach Russia a lesson; Saudi Arabia has cut its official sales quota for April by 6 to 8 dollars per barrel for all crude grades. Naturally, this big move by Saudi Arabia has raised the possibility of a price war in the international oil market. International benchmark Brent crude futures were down 31.5 percent to $ 31.02 a barrel after Saudi Arabia's decision to cut crude oil prices. For your information, let us know that this is the biggest drop in the prices of crude oil since the first Gulf War started on January 17, 1991, and February 12, 2016. At the same time, American West Texas Intermediate crude prices also fell by 27.4 percent to $ 30 a barrel. Explain that this is the biggest drop in the prices of American West Texas Intermediate crude after the first Gulf War.
Now, the price of crude oil has fallen by about 30 percent, petrol and diesel can be cheaper in India by around Rs 5 to 6 per liter. However, some people think that as the price of crude oil has fallen by almost 30 percent in the international market, the prices of petrol and diesel in India may be even lower. But according to experts, the price of petrol-diesel in India will not decline much as the Indian currency rupee is currently weak against the US dollar. But the reduction in the price of petrol and diesel from Rs 5 to 6 per liter will also be a relief for the Indian economy for some time; and due to such a fall in the price of petrol and diesel, a common Indian citizen will get relief for some time from inflation.
