Drone attacks on the world's largest oil refinery in Saudi Arabia, alleged to have been carried out by Iran over the past weekend.
Reserve Bank governor Shaktikanta Das Thursday expressed the hope that the ongoing crisis in Saudi Arabia that has spiked crude prices to multi-year highs will have limited impact on inflation and fiscal numbers. Drone attacks on the world’s largest oil refinery in Saudi Arabia, alleged to have been carried out by Iran over the past weekend, has lead to a massive 20 percent surge in crude prices.
The crisis has spooked domestic markets and roiled the rupee leading to fears that a prolonged supply disruption will create problems for the domestic economy as around 80 percent of oil demand is met through imports. Addressing the Bloomberg India economic summit here this evening, Das said he expects the Saudi crisis to have only limited impact on inflation and the fiscal numbers given the lower subsidy outgo.
He, however, was quick to add that the developments emanating from drone strikes on Saudi oil facilities are still playing out. Das said so far this fiscal the rupee has traded in a narrow range, with modest appreciation in the first quarter giving way to some depreciation in August and in the first half of September, accentuated by the drone attacks on Saudi oil facilities on September 14.