Oil prices hit 2014 highs on Iran sanctions: Impact on India







The fuel prices surged up to Rs. 17 paise across the metro cities on 2nd of October 2018.  In Kolkata, the Petrol price and Diesel price were Rs. 85.65 and Rs. 77.10 per litre respectively. This price hike was due to the enhancement in crude oil price in the international market as the crude oil price has crossed the level of $85 per barrel in recent times.

In this regard, it is to be stated that the oil price is close to four years high ahead of the USA sanctions on Iran. The upward trend in the oil market could be the result of the threat of the US-Iran trade war. India has a huge contract with Iran and it is one of the largest suppliers of crude oil, the trade war has a direct impact on the oil price in the country. State governments like Rajasthan, Andhra Pradesh, Karnataka and West Bengal have put their indirect effort by cutting down the VAT rate on Petrol and Diesel. However, as the cost of buying fuel from the foreign nations rises due to the price hike of the crude oil in the international market and the US-Iran dispute, there has been an upward movement in the petrol and diesel price in the Indian market.