Fuel prices in India, already down about Rs 4.5 a litre since the beginning of 2020, are set to fall further because global rates crashed more than a quarter after Saudi Arabia launched a price war amid demand crunch due to the spread of COVID-19. Maybe you have to pay approx Rs 8 per litre or less for petrol and diesel from next week.
Is the oil price crash good for Indian economy?
The overnight collapse in oil prices by 35 per cent after Saudi Arabia shocked the market by launching a price war can be good news for the Indian government facing a widening fiscal deficit.
The fall is great for the Indian government, which is facing low GST collections. Cheaper crude reduces India’s foreign currency outflow and inflationary pressures, besides grooming economic activity. The lower prices of oil reduce pressure on the inflation and relief economic activity.
The sharp fallout of Indian rupee against the US dollar, when more cases of the coronavirus were reported in the country, can play a spoilsport in the crude gain as it would appreciate the import costs. The exit of foreign institutional investors (FIIs) from the stock market is also not a good sign, which can hamper the crude bonanza, as it will hurt the economic activity.
Since India imports about 82 per cent of required crude – which cost $87 billion in 2018/19- lower oil prices benefit the government. The petrol price was cut by 24 paise a litre, while diesel price dropped by 25 paise, quoted by reports. The price of petrol reduced by Rs 4.55 a litre and diesel by Rs 4.7 a litre for five continuous days.
MEMES that are going viral on Twitter
Owners of crude oils companies to corona virus…#crudeoil #CrudeOilCrash #PetrolPrices pic.twitter.com/NWdRFvofYQ
— Patel Nidhi (@nidhi111199) April 21, 2020
As #petrolprices continued to hover at Rs 75 per litre and above in the four metro cities, #Twitterati on Wednesday tweeted their displeasure, apart from posting memes and funny comments.
Photo: IANS pic.twitter.com/H3J1nj26mG
— IANS Tweets (@ians_india) December 11, 2019
Oil price crash and going to negative.
Barrel cost is more than oil.
Refineries waiting for customers.#OilPrices #OilCrash #petrolprices pic.twitter.com/OCi1npI8Rb— Akhilesh Rajput काशी वासी (@akhilesh9998) April 21, 2020
#crudeoil really went to $0 pic.twitter.com/fH4lEzukkU
— Mohamed (@Mejka011) April 20, 2020
Didn’t expect that you wouldn’t know this! But yeah common people wouldn’t know this so let’s lead them against the government! That’s the best you can do in this dire situation? #PetrolPrices #coronavirusinindia #shameful pic.twitter.com/BDrxWmQvmr
— Abishek Kumar Singh (@abishek_singh91) April 21, 2020
When price of the oil dropped
Babu bhaiya : pic.twitter.com/AqaCzk6Zzk
— Baburao Ganpatrao Apte (@BabuRaoGanpat11) April 21, 2020
