New Delhi: In the wake of volatility in global crude oil prices due to an invasion of Ukraine by Russia, the government has said that India is "committed to supporting initiatives for releases from Strategic Petroleum Reserves, for mitigating market volatility and calming the rise in crude oil prices." In a statement released on Saturday, the Ministry of Petroleum and Natural Gas said, "Government of India is closely monitoring global energy markets as well as potential energy supply disruptions as a fall out of the evolving geopolitical situation."
"With a view to ensuring energy justice for its citizens and for just energy transition towards a net zero future, India stands ready to take appropriate action for ensuring ongoing supplies at stable prices," said the ministry. Crude oil prices had been on the rise and have surged past the US$100/barrel-mark after Russia declared an all-out war against Ukraine.
Price of Brent crude oil has now eased to US$97.93 per barrel after crossing the $101 per barrel mark on Friday. The West Texas Intermediate (WTI) crude is at $91.59 a barrel. However, since Russia is the world's third-largest oil producer, the invasion of Ukraine by the former and the slew of sanctions that have followed have raised concerns about oil supply disruptions.
India depends on crude oil imports to meet around 80 percent of its oil needs. The disruptions in supplies and rise in prices will have a huge negative impact on the Indian economy. Experts have said that an increase in the Brent price is expected to put higher inflationary pressure on the Indian economy, which is already reeling under record high inflation in last five years. Higher brent prices will increase the input cost of industrial production and make Indian products uncompetitive.
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