Post-Saudi Arabia Oil attack: Petrol prices seem to no sooner fall. It is continued to rise for the seventh consecutive day in India on September 23, Monday. With Rs 0.29 hike, the price of petrol has jumped to Rs 73.91 in Delhi. Before this, petrol was sold at Rs 73.62 in Delhi. Petrol prices have never been as expensive since November end 2018, when it was steady around Rs. 74. If the previous seven days are to be considered than the petrol price has gone up by Rs. 1.88 per litre. Notably, after an attack on Saudi Arabia’s oil plants, the oil prices have surged more than 15 percent in nearly four months. This is the highest level. Not only in India, because of the unexpected attack on the global oil supply had been hit out more than five percent.
It ‘s quite contradictory to the statement of Petroleum Minister Dharmendra Pradhan’s statement who stated clearly that oil distribution and supply would not be affected in the country after the attack on the stabilisation centers of Saudi Arabia oil giant Aramco.
5 things to know about surging petrol prices
1) Rising Petrol prices daily: Petrol prices have been rising on the regular prices for the last seven days from September 17. If the post-Budget hike in July is not considered, this surge in prices would be the highest weekly rise in fuel prices since 2017, as per a report.
2) Saudi Arabia Attack: It is quite evident that the latest price hike had a direct effect of the hike in crude oil rates after an attack on Saudi Arabia’s oil facilities strike more than 5 percent of the global oil supply.
3) Iran’s warning: Oil prices recovered today after Iran’s warning of the presence of US forces in the Gulf, causing instability in the region. Brent crude spiked more than 1.9% after jumping 6.7% in the last week. It is the biggest weekly gain since January.
4) Hike in Coming days: Chances are high that petrol prices in the coming days will witness an increase. India imports more than 80 percent of its oil requirement.
5) Exchange rate: Exchange rate of US dollar and rupee is also another big factor to influence the retail prices of petrol. Any spike in dollar rates, will be directly proportionate to a surge in the oil imports cost for India. Post weakening of about 1.65 percent so far in 2019, The rupee was trading ta 71.98 to a dollar, which came down on Friday’s close to 70.95.
Saudia Arabia facilities’ attack is a historical disruption to the oil supply till now. Attackers used low-flying drones and cruise missiles which hit 5.7 million barrels of production. In other words, it wrecked more than 60 per cent of Saudi Arabia’s current produce.
It was the largest supply disruption in the history. On Monday, Brent oil future rises to 15 per cent.