Prime Minister Narendra Modi warned in a Commerce Ministry webinar that the disruptions to supply chains will significantly impact the global economy.
Amidst growing uncertainty in the global economy over the Ukraine crisis and disruption of trade and shipping services following sanctions on Russia, the Brent Crude Oil futures jumped above USD 116 per barrel today, a short while ago, the highest in more than seven years.
That is all set to significantly increase India’s import bill on crude oil in the coming weeks as the country depends on imports for over three-fourths of its energy needs.
“During the global pandemic, the supply chain in the world has been shattered, and these days we are especially seeing that the issue of supply chains has shaken the economy of the whole world,” said Mr Modi.
The crude oil prices have been high even before the Russian invasion of Ukraine, with investors rushing into resources on supply concerns, in a bad sign for already-high global price pressures.
According to Petroleum Ministry data, the price of Brent Crude averaged $87.22 per barrel during January 2022 as against $74.10 per barrel during December 2021 and $54.84 a barrel during January 2021.
The Indian basket crude price averaged $84.67 a barrel during January 2022 against $73.30 per barrel during December 2021 and $54.79 a barrel during January 2021.
“Crude trades higher amid tightness concerns on the back of Russia-Ukraine fight, OPEC+ decision to raise output gradually and unexpected decline in US crude stocks. Crude may continue to trade higher unless there are genuine efforts to resolve Russia-Ukraine tensions, said Ravindra Rao, Head of Commodity Research at Kotak Securities. (NDTV)
