India stands to gain as crude oil prices fall to 4-month low

New Delhi, Nov 17 (IANS): With crude oil prices falling to a 4-month low in the international market, the Indian economy is expected to get a shot in the arm.

The country’s current account deficit had started to spiral out of control due to the huge oil import bill and the rupee had been weakening due to the higher demand for dollars to buy expensive oil.

The price of the global benchmark Brent crude fell by 4.63 per cent to close at $77.42 per barrel on Thursday, while the US's West Texas Intermediate crude oil futures fell 4.9 per cent to settle at $72.90 per barrel.

An increase in US crude oil inventories, a rebound in US Treasury yields, and the easing of oil demand due to the global economic slowdown have contributed to the decline in crude prices. Prices have in fact been gradually declining over the last four weeks.

India's merchandise trade deficit rose to a record high in October and the decline in oil prices would bring respite in November.

The country imports over 80 per cent of its crude oil requirement and any increase in prices leads to a sharp increase in the current account deficit.

Higher oil prices also fuel inflation and cause the government’s subsidy bill on LPG, CNG and fertilisers to go up which leads to a higher fiscal deficit.



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Comment on this article

  • Felix Pinto, Koteshwara

    Fri, Nov 17 2023

    Crude oil price in international market has been low since long time. Simultaneously, our PSU oil companies have been buying crude from Russia at considerably low price. But, the benefit has not been passed on to the consumer. That is Modi government for you.

    DisAgree [1] Agree [3] Reply Report Abuse

  • Jossey Saldanha, Rajeja Waterfront

    Fri, Nov 17 2023

    Only Ambani & Adani will Gain ...

    DisAgree [4] Agree [6] Reply Report Abuse

  • Roshan, Mangaluru

    Fri, Nov 17 2023

    Crude oil prices softened to almost 50Perc from what was during Dr. MMS tenure. Did Modi led BJP give any reprive to Indians? No. Instead the retail prices went up close to 100Prec. Consequence is Adani and Ambani got richer and poor middle class suffered in silence as usual. Now this is election time, so all media head lines will be trying to say acche din aaanhe walehn hain.

    DisAgree [4] Agree [9] Reply Report Abuse

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