With the Brent crude now oil trading at way below the pre-Saudi drone attack levels, petrol and diesel prices are likely to fall further in the coming days.
Petrol and diesel prices in India fell on Thursday for the first time in nearly one month days, as the continuous fall in Brent crude oil prices seems to have eased worries. Not only this, with the Brent crude now oil trading at way below the pre-Saudi drone attack levels, petrol and diesel prices are likely to fall further in the coming days. “The current fall in the Brent crude oil price is likely to bring the petrol price down by around Rs 1.5 in another 15-18 days,” Ajay Bansal, President, All India Petroleum Dealers Association, told Financial Express Online. After the crude oil prices fall globally, it takes 15-18 days to show the effect on the retail prices of petrol and diesel in India, he added.
Petrol price in Delhi fell 10 paise today to Rs 74.51 per litre, according to Indian Oil Corporation website. Diesel was sold at Rs 67.43 per litre. Earlier, global crude oil prices surged after an attack on Saudi Aramco’s oil manufacturing facility in mid-September. However, the instability thus caused has eased now.
India imports large chunk of its domestic oil demand and thus the global variation in oil prices significantly affect the retail prices in India. Brent crude prices in the international market dropped on Thursday to the second-lowest since January this year. Brent crude price touched $57.3 per barrel. Crude oil prices began falling since last week after Saudi Aramco assured of restoring the production capacity to the pre-attack levels and Saudi Arabia agreed to a partial ceasefire in Yemen.
Taking cues from the global recession, the crude price until the mid-September remained tepid but rose sharply following the attack. Now, when the certainty of oil supply is assured, the global slowdown has again cast its shadow on the oil prices. IMF warned on Tuesday that the global economic slowdown could be sharper than it previously expected.
“We see the global economy going through a gradual, synchronized slowdown,” the IMF’s First Deputy Managing Director David Lipton said. Unless the trade tensions are defused, it’s very hard to see mainstream macroeconomic tools countering the impact of escalating trade difficulties, so it’s very important that those be de-escalated, he added. Meanwhile, the World Trade Organization has substantially slashed its trade growth forecast for this year from 2.6 per cent in April to 1.2 per cent.