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Apr 10, 2008

Oil Price: $111 for a barrel, India's concern

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Oil prices steadied near $111 a barrel on Thursday. It was expected that on the day the oil prices would touch a record high. The US Energy Information Administration's inventory report, closely watched by the market, showed Wednesday that crude stocks fell 3.2 million barrels last week. On Thursday, the oil price rose 2 cents to $110.89 a barrel in Asian electronic trading by mid morning in Singapore.

The fluctuation in the oil price is a concern for the world as any rise in the oil price will have impact on the value of dollar in the international market. The US economy is under recession that causes slow down of world economy. The oil price rise will have an adverse effect on the Indian economy, as the nation is facing the three years high inflation pressure of 7 per cent. There is rise in the food price which is the big concern for the nation to keep this under control. The government has already rose the price of diesel and petrol before the union budget. People would not be in a mood to see the further rise in the oil prices. However, the oil price ups and downs is the prime concern of the government of India as it has to face the situation anyway.


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