30 May , 2022 By : Kanchan Joshi
NEW DELHI : Volatility in the crude oil market is likely to continue in the week ahead amid persistent supply concerns and prospects of a decline in demand.
“Crude oil remains stuck in a broad range as support from supply risks is countered by increasing demand uncertainty," said a recent report by Kotak Securities.
Although Shanghai and Beijing are gradually taking steps to ease restrictions, experts said that the restrictions have severely impacted the Chinese economy, one of the largest crude importers.
Further development in the EU’s plan to impose an embargo on energy imports from Russia would also provide cues to the market. However, the EU’s failure to reach a consensus has eased supply concerns. Oil prices last closed on a positive note amid a decline in crude oil inventory in the US. On 27 May, the July contract of Brent on the Intercontinental Exchange closed at $119.43 per barrel, higher by 1.73% than its previous close.
The July contract of West Texas Intermediate on the NYMEX closed at $115.07 per barrel, higher by 0.86%.
Despite the volatility in the global oil prices, retail prices of petrol and diesel in India have remained unchanged for a week now.
On Sunday, petrol was sold for Rs96.72 per litre, while diesel was priced at Rs89.62 a litre.
Fuel prices were last revised on 22 May, a day after the government announced a cut in the central excise duty on petrol by Rs8 per litre and on diesel by Rs6 a litre. Several state governments, including Maharashtra, Karnataka, Odisha, Kerala, and Rajasthan, have also lowered value-added taxes after the Centre’s move.
Rising crude oil prices and a Rs10 per litre increase in petrol and diesel prices from 22 March-6 April raised inflationary concerns.
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