Concerns over lower supply amid escalating Russia-Ukraine conflict pushed up global crude oil prices to $102 per barrel on Tuesday.
The rise in crude oil prices comes after negotiations failed to resolve the Russian-Ukrainian conflict. The Brent-indexed crude oil prices had risen by 5 per cent to over $98 per barrel on Monday.
Russia is the third largest producer of crude oil in the world. It is feared that sanctions against Russia will start to curtail global supplies and stifle growth.
On last Friday, a rise in the US oil inventories along with assurance of energy supply from Russia had doused international crude oil prices. Consequently, the price on last Friday came down to $95 per barrel after the Russia-Ukraine war pushed Brent Crude Oil prices to $105 per barrel.
For India, the price range is a cause of concern as it may add Rs 8 to Rs 10 in petrol and diesel selling prices, if the OMCs decide to revise the current prices.
The cascading effect of higher fuel cost will trigger a general inflationary trend. "Crude oil prices rallied on Tuesday with ICE Brent oil surging more than 4 per cent, above $102 per barrel," said Tapan Patel, Senior Analyst (Commodities), HDFC Securities.
"Crude oil prices resume rally on concerns over lower supply amid failed talks between Russia and Ukraine."
According to IIFL Securities VP, Research, Anuj Gupta: "Crude oil is trading higher due to escalating geopolitical tension... We are expecting that crude oil may test $105 to $108 levels soon."