Petroleum prices are going to up next week

The cost of crude oil in the international markets has gone up to $ 100 per barrel, due to which a difference of 9 rupees per liter has been created in the price of petrol. To fill this gap, the Government of India will have to raise the prices of petrol and diesel in the country from next week after the state elections are over. One of the reasons for the sudden increase in the price of crude oil in the world market is Russia’s fierce military operation in Ukraine. The oil market fears that the supply of oil and gas from Russia may stop due to this war or due to economic sanctions from Western countries. Let me tell you that Russia is a major supplier of crude oil and natural gas. Russia has been supplying one-third of the oil and gas needs of European countries, and the pipelines through which this supply has been made pass through Ukraine. In addition, Russia has been fulfilling 10 per cent of the total requirement of the international market. However, India buys less than 2 percent of the total imports of oil and coal from Russia. Therefore, India is not worried about the supply of oil, but its concern is definitely the growing prices of crude oil in the international markets.
This type of concern is being felt in the international market for the first time since 2014. According to the Petroleum Planning and Analysis Cell (PPAC) of the Ministry of Oil, India had to pay $ 102 per barrel on March 1, 2022 for crude oil. In November last year, the price of oil was $ 81.5 per barrel. Indian Oil Corporation (IOC), Bharat Petroleum and Hindustan Petroleum Corporation (HPC) are incurring losses of Rs 5.7 per liter on petrol and diesel due to increase in oil prices, which does not include their margin of Rs 2.5 per liter. To bring both losses and margins to a balanced level, these state-owned oil companies will have to raise the price by Rs 9-10 per liter. India has not allowed oil prices to rise for three and a half months since November, while oil has been getting expensive in the global markets. The country imports 85 percent of its oil and gas from outside. Oil prices are reviewed on a daily basis, but in view of the elections in five states including UP, Punjab, Uttarakhand, this is not being done at the moment.
The Russia-Ukraine war has raised fears of inflation of all kinds, not just petrol and diesel. As mentioned earlier also in this column, the heat of the war will be felt in every part of the world for a long time. The loss is not only happening to Ukraine, but the people of Russia will also bear this loss for a long time. The effect of economic sanctions of USA and European countries is already visible there. Even Russia had to close its stock market for a week. The price of the Russian currency Ruble has been falling against the US Dollar and interest rates in the country have gone up. Orders from Russian traders have started getting canceled and many multinational companies have started closing their business with Russia.