Why Indian motorists should be worried about Israel-Hamas war?

Despite the pricing of petrol and diesel at a sky-high level across India, over the last several months, the price of motor fuels has remained majorly unchanged. This certainly brought relief to vehicle owners across India, especially after a relentless surge of petrol and diesel prices in 2022. However, the ongoing Israel-Hamas conflict poses a threat to the stability in fuel pricing the country has been observing over several months.

Crude oil prices in the international market have claimed about three per cent to a one-week high on Saturday, owing to the conflict-related tensions in the Middle East, a region that has been known as the key supplier of fossil fuel across the world. Brent crude futures rose $2.55, or 2.9 per cent, to settle at $90.48 a barrel, while US West Texas Intermediate (WTI) crude rose $2.33, or 2.8 per cent, to settle at $85.54 earlier this week. Brent's premium over WTI rose to its highest since March 2023.

The escalation in the Israel-Hamas conflict has been resulting in a spike in crude oil prices. Adding woe to worry is the possibility of supply chain disruption. India is one of the major importers of fossil fuels for its domestic requirements. With more than 85 per cent of the country's fossil fuel coming through imports from various countries across the world and a majority coming from the Gulf countries, the war and related supply chain disruption could impact India's fuel supply chain adversely. This in return could result in a price hike for petrol and diesel in the country, which will impact vehicle owners across India.

The petrol price in Delhi on October 29 is ₹96.76 per litre, while a litre of the fuel costs ₹102.62 in Chennai, ₹106.29 in Mumbai and ₹106.01 in Kolkata. Diesel prices per litre on October 29 in Delhi, Chennai, Mumbai and Kolkata were ₹96.72, ₹102.60, ₹106.00 and ₹111.30, respectively.