Crude Oil Sees Biggest Weekly Drop in Months, What It Means for Fuel Prices in India

New Delhi: There has been a big decline in the prices of crude oil in the international market during the last one week. Although oil prices registered a slight rise on the last trading day of the week, overall both Brent crude and US WTI crude have slipped by about 8 per cent. In such a situation, the biggest question is whether there will be relief in the prices of petrol and diesel in India.

How much did crude oil become cheaper in a week?

The price of Brent crude in the international market has reached 80.57 dollars per barrel. A week ago its price was above 87 dollars per barrel. Similarly, American WTI crude has also come down to 77.54 per barrel. According to experts, in the last seven days both the major benchmarks have registered a decline of about 8 per cent.

What is the reason for the fall in oil prices?

Experts believe that the reduction in tension in the Middle East and the possibility of a ceasefire between Israel and Hezbollah have given relief to the market. Apart from this, the news of possible agreement between Iran and America has also reduced the concerns regarding oil supply. Investors are hopeful that the supply of oil in the global market may increase in the coming time.

What will be the impact of Iran-US agreement?

According to reports, after the agreement between Iran and America, the way may be cleared for supply of millions of barrels of additional oil in the global market. If the sanctions imposed on Iranian oil are relaxed, the supply in the market will increase, which may put further pressure on prices.

Can crude oil reach 60 dollars per barrel?

Many international financial institutions believe that if peace continues in the Middle East and oil supplies return to normal, crude oil prices may fall further in the coming months. Some analysts estimate that Brent crude may reach the level of 60 to 65 dollars per barrel in the next 6 to 12 months.

Will petrol and diesel become cheaper in India?

Despite the fall in crude oil prices, there seems to be little possibility of immediate relief in the prices of petrol and diesel. Experts say that in recent months, oil marketing companies had to suffer huge losses due to crude oil inflation. Companies would like to compensate for that loss first.

What are the prices of petrol and diesel in major cities of the country?

According to Indian Oil data, petrol is being sold at Rs 102.12 and diesel at Rs 95.20 per litre in Delhi. Whereas in Mumbai petrol is Rs 111.21 and diesel is Rs 97.83 per litre. In Kolkata, petrol remains at Rs 113.51 and diesel at Rs 99.02 per litre, while in Chennai petrol remains at Rs 107.77 and diesel at Rs 99.55 per litre.

What is expected next?

Experts believe that if the prices of crude oil in the international market reach 75 Dolalr per barrel or below, then the possibility of reduction in the prices of petrol and diesel in India may increase. At present, the eyes of investors and consumers are fixed on the developments in the Middle East and the movement of the global oil market.