Crude oil above $95 per barrel mark, expected to breach $100 price tag by THIS time | What does this mean for India?

Crude oil price news: Around 9:30 am IST on Tuesday, the global oil benchmark, Brent crude futures, recorded gains for the fourth consecutive session, soaring by 0.61 per cent to $95.01 a barrel. The $95 mark was last breached in November 2022. India, the world's third-largest oil importer, is likely to feel the pinch from the soaring prices.
author-479256715

Updated Sep 19, 2023 | 12:44 PM IST

Crude oil price news today

Crude oil prices are nearing the 100 mark (Pic: Canva Pro/TIMES NOW Digital)

Crude oil price news: Crude oil prices, which extended their gains further this week on the back of tight supply factors, are now inching ever closer to the $100 per barrel mark. Around 9:30 am IST on Tuesday, the global oil benchmark, Brent crude futures, recorded gains for the fourth consecutive session, soaring by 0.61 per cent to $95.01 a barrel. The $95 mark was last breached in November 2022.

Behind the rally

Several factors are responsible for the increase in crude oil prices. Weak shale output in the United States has exacerbated concerns about a deficit of the precious resource. Worries about a steady crude oil supply had been sown by oil giants Saudi Arabia and Russia's announcement that they would extend a combined 1.3 million barrels per day (bpd) of voluntary supply cuts until the end of the year. Moreover, signs of a resurgent Chinese economy have been raising hopes of increased energy demand.

Crude oil price forecast

Crude oil prices are forecast to reach $93.69 per barrel by the end of the current quarter and breach the $100 mark in a year's time, Economic Times reported citing projections from Trading Economics' global macro models and market analysts.

What does this mean for India?

India, the world's third-largest oil importer, is likely to feel the pinch from the soaring prices. A mere $10 hike in oil prices could trigger a 20 basis-point increase in India's current account deficit, potentially pushing it to 1.8 per cent of GDP, Economic Times recently reported.
Last week, against the backdrop of crude prices surging past the $90 per barrel mark, sources had told ET NOW that Oil Marketing Companies (OMCs) in India have started making losses on the sale of diesel and petrol. The OMCs' accumulated losses then were around Rs 1.5 lakh crore. Sources had noted that this figure would get worse if crude oil prices continued their upward trajectory.
End of Article