Russia has alarmed all countries of the globe by attacking Ukraine yesterday. As a result of this conflict, crude oil prices have risen dramatically. The increase in crude is concerning for many countries, and economists predict that the news will be even more so for India.
For the first time since 2014, crude oil prices surpassed $105 per barrel. Brent crude hit a record low of $105 per barrel yesterday, the highest level in eight years. Brent crude prices have fallen to this level for the first time since 2014, and this spike in costs is unquestionably bad news for India. As a result, India's crude basket imports will be exceedingly expensive.
Russia is the world's second-largest oil exporter and Europe's second-largest natural gas supplier. Both of these exports will be harmed by the conflict situation and the sanctions placed by the US on Russia, and many countries around the world will be affected.
The price of crude oil is projected to stay at $100 or higher shortly, and the situation will not change unless OPEC members decide to raise their oil production. According to economic experts, OPEC countries have not been exporting oil following their targets for the last three months, and as a result, the price of crude oil is likely to remain above $ 100 per barrel or higher. India's import cost might rise by more than 15% as a result of this, as the country imports more than 85% of its oil.
Russia consumes one out of every ten barrels used worldwide, and if the conflict in Ukraine continues, it might be a major source of concern for India. The reason for this is that it has a significant influence in determining oil prices, and due to the sanctions placed on Russia, it will be able to restrict exports. If the war in Ukraine continues for a long time, India will be forced to acquire expensive oil, causing the country's import bill to rise by more than 15%.