The ongoing tension in West Asia is still affecting the entire world. Meanwhile, it has come to light that the prices of petrol and diesel may increase once again. This increase is likely to happen before 15. According to sources, due to the ongoing conflict in West Asia, there has been a huge jump in the prices of crude oil, which has created huge economic pressure on oil companies (OMCs).
According to sources, oil marketing companies are facing under-recovery of about Rs 30 thousand crore every month. The price of crude oil in the international market has increased from $ 70 per barrel to $ 126 per barrel. Despite this, till now the prices of petrol and diesel have been kept stable in India. It is being told that the government and oil companies are jointly bearing the additional burden of about Rs 24 per liter on petrol, so that the impact of inflation on the common people is reduced.
However, amidst increasing pressure, now consideration is being given to increasing the prices of petrol and diesel. Sources say that the prices can be revised before May 15.
Crude oil prices increased
In fact, the crisis arising around the Strait of Hormuz has shocked the global crude oil market. Despite the price of crude oil increasing from around $70 per barrel to $126 per barrel in the international market, there has been no major increase in the prices of petrol and diesel in India so far. But this relief cannot last long. Sources have told Business Today that the prices of petrol and diesel may increase before May 15.
Hormuz effect on oil market
In fact, about 20 percent of the world’s oil supply passes through Hormuz. Due to the ongoing war in West Asia, this sea route has been affected for several weeks, due to which the energy crisis is deepening in the entire world. Fuel prices have increased rapidly in many countries. Petrol has reached around Rs 295 per liter in Hong Kong, Rs 240 in Singapore, Rs 225 in Netherlands, Rs 210 in Italy and around Rs 195 per liter in Britain. In comparison, petrol is still being sold at around Rs 95 per liter in many cities of India.
Oil crisis in many countries, emergency steps taken
Many countries of the world have taken emergency steps to deal with this crisis. Bangladesh has imposed fuel rationing, Sri Lanka has introduced a four-day working week, Pakistan has reduced the working days of government offices, while South Korea has imposed a fuel price cap for the first time in decades.
This is how India has avoided the crisis so far
However, in India there was neither shortage of fuel nor long queues or rationing. According to government and industry sources, India took swift action as soon as the crisis began. Domestic LPG production was increased from 36 thousand tons per day to 54 thousand tons per day in a few days. Besides, the government also made a huge cut in the excise duty on petrol and diesel, so that the burden on the common people is reduced.
How much burden on oil companies?
According to industry estimates, when crude oil prices reached their peak, the government and oil companies together were bearing the additional burden of about Rs 24 per liter on petrol and about Rs 30 per liter on diesel. Even after reducing the excise duty, companies like Indian Oil, Bharat Petroleum and Hindustan Petroleum are facing a loss of about Rs 30 thousand crore every month.
India kept the supply stable by increasing imports of crude oil from Russia, America, West Africa and other regions. It is being told that the country’s refineries are working at more than 100 percent capacity, so that the availability of fuel is not disrupted. Officials say that the expansion of energy infrastructure in the last decade has also helped India deal with this crisis better.
Since 2014, the number of LPG terminals has doubled, crude oil import sources have increased from 27 countries to 40 countries, ethanol blending has increased from 1.5 per cent to 20 per cent and strategic petroleum reserves have also been strengthened. However, conflict continues in West Asia and crude oil prices remain high. In such a situation, the pressure on government oil companies is continuously increasing and it is believed that a decision can be taken to increase the prices of petrol and diesel in the coming days.
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