The conflict between the two Middle East countries has increased pressure on global oil supplies.
New Delhi: The intensifying conflict between Iran and Israel has had a major impact on the global oil market. Brent crude oil prices rose by about 5.5 percent on Monday to touch around $75 per barrel. The main reason for this is the Israeli missile attack on Iran's oil infrastructure, especially two gas plants and an oil depot.
The conflict between the two Middle East countries has increased pressure on global oil supplies. This trend has created a 'risk premium' in the market, especially increasing concerns about the security of the Strait of Hormuz. If the Strait of Hormuz is closed, global oil supplies could face a major disruption, so that oil prices could reach $100 to $120 per barrel.
The conflict has not only increased oil prices, but also increased the costs of oil marketing companies in all areas. With the rising cost of natural gas, oil and shipping, there is a risk of rising prices of manufacturing, transportation and consumer goods. As a result, the possibility of inflation is almost certain to emerge globally. Meanwhile, the capital markets are also seeing mixed reactions.
“If the Middle East remains unstable for a long time, the Indian economy will come under pressure. We need urgent policy intervention to keep our currency and inflation under control,” said a former official of a state-owned bank. According to another economic expert, “A prolonged rise in oil prices will require the Reserve Bank to take tough decisions. It will be difficult to control inflation without raising interest rates.”
The conflict between the two Middle East countries has increased pressure on global oil supplies. This trend has created a 'risk premium' in the market, especially increasing concerns about the security of the Strait of Hormuz. If the Strait of Hormuz is closed, global oil supplies could face a major disruption, so that oil prices could reach $100 to $120 per barrel.
The conflict has not only increased oil prices, but also increased the costs of oil marketing companies in all areas. With the rising cost of natural gas, oil and shipping, there is a risk of rising prices of manufacturing, transportation and consumer goods. As a result, the possibility of inflation is almost certain to emerge globally. Meanwhile, the capital markets are also seeing mixed reactions.
“If the Middle East remains unstable for a long time, the Indian economy will come under pressure. We need urgent policy intervention to keep our currency and inflation under control,” said a former official of a state-owned bank. According to another economic expert, “A prolonged rise in oil prices will require the Reserve Bank to take tough decisions. It will be difficult to control inflation without raising interest rates.”
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