New Delhi. Crude oil prices in the global market have once again raised concerns. After recent developments, Brent crude has crossed $ 115 per barrel, which is considered to be the highest level in recent times. The main reason behind this sudden rise in prices is the increasing tension in West Asia.
Prices increased due to Middle East tension
The escalating conflict between Iran and Israel has shaken the energy market. Instability has increased in the region after attacks on important energy centers like South Pars gas field. The field is home to one of the world’s largest natural gas reserves, which Iran and Qatar share. Due to these incidents, uncertainty over the supply of oil and gas has increased, leading to a sharp rise in prices.
Danger looming over the Gulf of Hormuz
The Gulf of Hormuz is the most important route for global oil supply. About 20% of the world’s oil is supplied through this route. If there is any kind of obstacle here, it affects the entire world. This is even more important for India, because a large part of the country’s oil comes through this route.
Why is India most affected?
India imports about 90% of its oil needs. In such a situation, as soon as the price increases in the international market, it has a direct impact on the country’s economy. Due to oil becoming expensive, not only the prices of petrol and diesel can increase, but the cost of transport, electricity and everyday items also increases, due to which inflationary pressure increases.
Effect visible in stock market also
The impact of the rise in oil prices was also seen on the domestic stock market. A huge decline was recorded in the market, due to which the concern of investors has increased. Expensive crude oil has a direct impact on the costs of companies, which puts pressure on their profits.
What signs next?
Experts believe that if tension in West Asia continues for a long time, oil prices may go up further. This will also increase pressure on the global economy. This situation can be challenging for India, because it can affect trade deficit, inflation and economic growth.
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