As soon as Hormuz opened after 49 days, there was a huge fall in the prices of oil and gas, India will get big relief.

New Delhi: Iran announced big relief on Friday. After 49 days, the Strait of Hormuz has been completely opened. Now the movement of all commercial ships will be possible without any restriction in the remaining days of the ceasefire. This news immediately had a positive impact on the global energy market and oil and gas prices fell rapidly.

Huge fall in oil and gas prices

Immediately after the announcement by Iran’s Foreign Minister Abbas Aragchi, oil prices fell by about 9-10 percent. Brent crude fell by $ 8.46 to $ 90.93 per barrel. US WTI crude fell by $ 8.87 to reach $ 85.82 per barrel.

Besides, Europe’s benchmark gas contract also declined by 8.5 percent. US President Donald Trump also said that an agreement to end the war with Iran can be reached soon. These positive news have given relief to the market.

Why a big relief for India?

The Strait of Hormuz is the world’s most important energy corridor. About 20 percent of the world’s oil passes through this route. There was a lot of pressure on India due to the closure of Hormuz in the last 49 days. Oil and gas tankers coming from Gulf countries got stuck, due to which the shortage of oil and gas in the country increased.

Now with the opening of the strait, oil and gas tankers will be able to reach India without stopping. The disruption in imports will end and the supply of petrol, diesel and LPG is expected to improve.

What will be the impact on India?

India is the third largest oil importer in the world. The fall in crude oil prices due to the opening of Hormuz will prove beneficial for India.

• The prices of petrol and diesel are likely to remain stable or decrease slightly.
• Availability of domestic gas cylinders and CNG may be better.
• There will be some relief on the import bill, which will reduce the government’s expenditure.

However, how permanent the fall in prices will be will depend on the permanent peace agreement between Iran and America. If the ceasefire continues for a long time and Hormuz remains completely safe, then India can benefit in the long run.