How rising crude prices may affect
Global crude oil prices inched upward to hit their highest level But why is crude so important for India? India is a net importer of crude oil and imports nearly 80 percent of its oil requirement. A meaningful rise in Brent prices will strain India’s fiscal/current account deficit, trigger inflation concerns for the Reserve Bank of India (RBI) and also dent hopes of a credit rating upgrade for India. “India imports 3 million barrels per day higher crude oil prices will increase raw material cost, working capital requirements, and operating costs for user industries such as lubricants, chemicals (including consumer staples), and paints. Sectors that are likely to see increasing pressure thanks to a rise in crude oil prices are upstream oil companies. However, the same will be positive for export-oriented sectors such IT and pharma as rising in crude will put pressure on the currency as well sectors like airlines, paints, tires, plastics, and select fast-moving consumer goods (FMCG) co