New Delhi
Oil prices declined for a third day in a row in the international market on Wednesday, despite geopolitical tensions, as the US Federal Reserve is not expected to reduce interest rates any time because of the high inflation rate.
Prices of the benchmark Brent crude have now come down to $82.28 a barrel from close to $84 a barrel at the end of last week. The US West Texas Intermediate crude (WTI) futures were trading at $78.02 on Wednesday indicating the further softening of prices.
Since India imports close to 85 per cent of its crude requirement, the decline in oil prices reduces the country’s import bill and strengthens the rupee.
The Government has also helped to cut the country’s oil import bill by allowing the oil companies to buy Russian crude at discounted prices despite the pressures from Western countries to stop these purchases in the wake of the Ukraine war.
Russia has now emerged as the largest supplier of crude oil to India replacing Iraq and Saudi Arabia which occupied the top slot earlier. India has in fact become the largest purchaser of Russia’s seaborne oil which accounted for close to 38 per cent of India’s total oil imports in April.
In fact, India’s strategy of continuing to buy cheap oil from Russia has resulted in the saving of around $7.9 billion in the country’s oil import bill during the first 11 months of the fiscal year 2022-23 and also helped the country to lower its current account deficit.
