Concern regarding the prices of petrol and diesel has increased again in the country. The Indian government on Saturday reviewed crude oil and fuel supplies, especially amid the tense situation in the Middle East. The government said it is taking every step to ensure domestic supply and will continue to monitor the situation.
The Petroleum and Natural Gas Minister held a meeting with senior officials of the Ministry and public sector companies to review the availability of crude oil, LPG and other petroleum products. The ministry said in a statement, ‘We are continuously monitoring the situation and will take all steps to ensure availability and affordability of fuel in the country.’
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Why has India’s concern increased?
India depends on imports for about 85 percent of its crude oil needs, mostly from West Asia. Experts say that if the global crude oil price increases by $1, India’s annual oil import bill increases by about $2 billion. This increases inflation, increases current account deficit and makes it difficult to determine the price of domestic fuel.
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Not only petrol, these things will also be affected
Crude oil is not just a source of fuel. It is also used in everyday products like detergent, biscuits, toothpaste, paint and packaging materials. Soaps, shampoos, creams, hair oils and plastic bottles also contain petroleum products. Crude oil accounts for 25 percent of the production cost of FMCG companies and about 40 percent of paint companies. Therefore, long-term rising oil prices will directly impact common consumers.
Why did the global supply chain come to a standstill?
The situation became worse when Qatar’s state-owned company QatarEnergy stopped the production of Liquefied Natural Gas (LNG) after Iranian drone attacks. This led to a sharp increase in gas prices in Europe. Saudi Arabia also closed some units of its Ras Tanura oil refinery for some time.
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Qatar Energy said production of LNG and related products has been halted due to military attacks in the Ras Laffan and Mesaieed industrial areas. However, there is no news of anyone being injured. This crisis has affected the global market and gas prices in Europe have increased by almost 50 percent. Due to which the fear of supply crisis continuing for a longer period has increased.
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