What was feared happened, the price of crude oil increased by 10 percent in the global market, know the impact on India.

Oil Prices: Amidst the attacks by America and Israel on Iran, the prices of crude oil have increased by 10 percent in the global market. With the opening of the Asian market on Sunday, a strong increase of 10 percent was seen in the prices of crude oil.

The prices of both Brent crude and Nimex light sweet crude rose sharply in early trading on Monday. At one point, Brent jumped by more than 12 percent to around $ 82 per barrel, which is higher than the closing price of $ 73 per barrel on Friday. However, later there was some softening in both of them.

Prices increased suddenly

By Monday morning in Asian markets, crude oil was seen trading at around $79.30 with an increase of almost 9 percent. During this period, US crude rose by almost $ 8 or 12 percent to $ 75 per barrel, while West Texas Intermediate rose by almost 8 percent to $ 72.

This year already a rise in oil prices is being seen. International benchmark prices have increased by about 20 percent since January. On top of that, the rise in oil prices again is worrying. Experts have warned that if prices increase further, the cost of energy may increase further. However, this will depend on Iran’s retaliation and obstacles on the supply route.

Concerns about the Strait of Hormuz

Of particular concern is the Strait of Hormuz, which is a narrow passage located at the mouth of the Persian Gulf. This is the only sea route that connects the Persian Gulf to the Gulf of Oman or the Arabian Sea. It has Iran in the north and Oman and United Arab Emirates in the south.

The Strait of Hormuz is also called the gateway to the Persian Gulf because through this narrow route the world’s major producing countries like Saudi Arabia, Kuwait, Qatar, Iraq send their oil out. Every day about 15 million barrels of crude oil passes through this route, which is about one-fifth of the world’s supply.

India also imports a large part of its crude oil needs through this route. There are fears that this route will be closed due to the war between Iran and Israel. In such a situation, the speed of shipment may slow down or stop completely. This may ban exports and increase the prices of crude oil and petrol across the world.

Will petrol and diesel prices increase in India?

Experts say that every 1 dollar increase in Brent crude means 0.55 per liter pressure on petrol and 0.52 per liter pressure on diesel at the retail level. In such a situation, due to this 10 percent increase in Asian markets, there is a strong possibility of increase in the prices of petrol and diesel in India also. This will also increase the costs of companies related to paint, lubricants, tires and aviation, which will reduce their profits. However, to deal with this challenge, the government can take steps like cutting excise duty or reducing the margins of oil companies.

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