Crude Oil – Impact of Fall in prices in Indian Economy – Falling Prices impact Favourable OR Adverse

Much of the economy depends on oil. This is why prices of oil matter to almost every economy. Global crude oil prices are down nearly by 60% this year to $40 per barrel-levels from $110 / barrel at the start of the year. This has caused a crisis in countries like Russia, which depends on oil exports.

India is the IVth largest country to import crude oil. Around 35 lakh Barrels per day consumption is estimated for India. India’s growth story hovers around the import of oil as India imports 80% of its crude requirements. Any negative change in the crude oil price has an immediate positive impact on the increment in the GDP and IIP. A one-dollar fall in the price of oil saves the country about 40 billion rupees. Oil is one of the most important commodities in recent times.

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