New Delhi: Global crude oil prices rose over 1% in early deals on Thursday as investors worried about a potential supply crunch amid demand concerns due to Russia’s invasion of Ukraine and the pandemic-induced lockdown in China. did.
Russia’s invasion of Ukraine and Western sanctions on its oil exports could effectively cut Russian supplies from global markets by 3 million barrels from next month, the International Energy Agency (IEA) has said. The agency has cut its forecast for global oil supplies this year by 2 million barrels a day to 99.5 million barrels, based on what major producers of the Organization of the Petroleum Exporting Countries (OPEC) have currently agreed to pump.
Meanwhile, OPEC has said that demand in 2022 will face challenges from rising inflation in the form of Russia’s invasion of Ukraine and rising crude prices. However, the cartel sticks to its estimate that world oil demand will increase by 4.15 million barrels per day (bpd) in 2022.
At 0900 am, the Brent May contract was trading at $99.15 a barrel on the Intercontinental Exchange, up 1.15% from the previous close. West Texas Intermediate (WTI) April contract rose 1.33% to 96.30 per barrel on the NYMEX.
Prices have tumbled of late due to a ceasefire from Russia-Ukraine peace talks and demand concerns due to the COVID-19 lockdown in China following the worst outbreak since the start of the pandemic.
On March 7, Brent reached $139.13 a barrel, the highest since 2008.
High oil prices are a cause of concern for India as the country imports 85% of its oil demand. The recent surge in global crude also pushed up the price of the Indian energy basket, including Oman, Dubai and Brent crudes. It was last recorded at $110.30 a barrel on March 14, according to data from the Petroleum Planning and Analysis Cell of the Ministry of Petroleum and Natural Gas.
Though the hike in crude oil prices has not yet been transferred to consumers of petrol and diesel, oil marketing companies on Wednesday hiked jet fuel prices by a whopping 18%. In a first, aviation turbine fuel (ATF) prices are now above 1 lakh per kiloliter mark.
Petrol price remained unchanged on Thursday 95.41 per liter, while the diesel was sold for 86.67 per liter in the national capital.
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