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India-Israel war: Oil and LNG prices could see a notable rise if Iran opts to block the Strait of Hormuz, a key route for importing crude oil from 'Saudi Arabia', 'Iraq', and 'UAE'. Analysts have pointed out that this could lead to increased inflation. The conflict between Iran and Israel has escalated recently, with Iran launching drone and rocket attacks on Israel, prompting Israel to respond with missile strikes. Crude oil prices have hovered around USD 90 per barrel amid the tensions. While efforts to de-escalate the situation are underway, Motilal Oswal Financial Services has warned of potential price hikes in oil and LNG if Iran takes steps to restrict the flow of oil through the Strait of Hormuz.
India-Israel war: Oil and LNG prices could see a notable rise if Iran opts to block the Strait of Hormuz, a key route for importing crude oil from Saudi Arabia, Iraq, and UAE. Analysts have pointed out that this could lead to increased inflation. The conflict between Iran and Israel has escalated recently, with Iran launching drone and rocket attacks on Israel, prompting Israel to respond with missile strikes. Crude oil prices have hovered around USD 90 per barrel amid the tensions. While efforts to de-escalate the situation are underway, Motilal Oswal Financial Services has warned of potential price hikes in oil and LNG if Iran takes steps to restrict the flow of oil through the Strait of Hormuz.
India is buying more Russian oil, despite it being priced above the Western cap of $60 per barrel, due to a resurgent Brent Crude. India has been purchasing Russian oil even though it has breached the G7's price cap. India argues that it will buy any oil that is cheaper, prioritizing energy security. However, the costlier Brent Crude is causing concerns for the global economy and impacting India's CAD and currency value.
The average cost of Russian crude arriving in India in June reached the lowest level since the country's invasion of Ukraine over a year ago. The price was $68.17 per barrel, including shipping costs, down from $70.17 in May. India is among the countries that have become reliant on cheaper Russian crude since the war, along with China.
The price for each barrel including freight costs was $68.17, down from $70.17 in May and $100.48 a year earlier, according to the latest figures from India’s Ministry of Commerce and Industry. While that’s higher than a $60 cap imposed by Western nations on Moscow, the threshold doesn’t include shipping.
Fuel Prices: Petrol and diesel prices across many parts of India are currently hovering over the INR 100/litre-mark. After a lull due to high international prices, OMCs are now recouping their losses. However, economists don’t expect the Centre to immediately cut taxes on fuel despite the availability of fiscal space, meaning that consumers will continue to shell out more.
On Wednesday, Indian government officials said that state-controlled Indian Oil Corp. had reached a deal to buy 3 million barrels of oil from Russia's Rosneft Oil Co. at a 20% discount to global prices.