Explained: Crude oil could cost up to $65, petrol will become cheaper by Rs 5!

Crude oil prices are at their lowest level in several months. Will petrol and diesel prices become cheaper in the coming months?

A huge drop in the price of crude oil has been observed in the international market. There is a huge drop in the prices of crude oil from the Gulf countries compared to the US crude oil. Brent crude oil has fallen below $72 per barrel. While WTI has fallen below $70 per barrel. According to experts, due to good data from China and the US, a drop in crude oil prices is observed. On the other hand, OPEC has also indicated to increase production from October 1. The effect of this is being seen in crude oil prices. The production issue in Libya has also been resolved. In such a situation, a further drop in the price of crude oil is observed.

Experts believe that crude oil prices may continue to fall. Some say that oil from the Gulf countries may fall to $65 per barrel. While some say that if the price of Brent crude oil falls below $70, then OPEC may postpone the decision to increase production. In such a situation, crude oil prices will rise again.

On the other hand, the interest rate cut by the Federal Reserve will also support crude oil prices. Now the biggest question that has arisen is whether petrol and diesel prices will come down. According to experts, if the crude oil price reaches $65, the price of petrol and diesel may fall by Rs 5. Let us try to understand the mathematics of petrol and diesel.

Brent crude oil fell below $73

The price of Brent crude oil from the Gulf countries has fallen below $73. According to foreign markets, Brent crude oil was quoted at $72.61 per barrel during the trading session. However, at present prices are at $73.55. What is special is that over the past 24 hours the price of Brent oil has dropped by 6.33 percent. On the other hand, if we talk about August 15 onwards, the price of oil in the Gulf countries has fallen by 10.36 percent. According to some experts, crude oil from the Gulf countries could fall even further by $5 to $8.

US oil below $70

On the other hand, a further decline in the price of US crude oil has been observed. According to the data, the price of US oil during the trading day rose to 69.10 dollars per barrel. Currently, the price of US oil is quoted at 69.98 dollars per barrel. However, a drop of 7.14 percent per barrel has been observed. What is special is that since August 15, the price of US oil has dropped by 11.59 percent. US oil prices can rise up to 63 dollars per barrel.

Who is making crude oil cheaper?

1. Recently, data on the US manufacturing sector have been published that do not meet expectations. On the other hand, the debate about the slowdown is in full swing in the United States. As a result, there is a decline in demand.
2. The data from China is not good either. The effect of this is visible in the demand for crude oil. If the world’s largest importer reduces the purchase of crude oil, then it is natural that prices will fall.
3. OPEC, the organization of crude oil producing countries, has said that it will increase crude oil production from October 1, meaning that there will be more supply on the market. The effect of this will be seen in the form of lower crude oil prices.
4. The issue of production and supply in Libya is very close to being resolved. In such a situation, there will be a further increase in supply. The amount of oil that will reach the market. The same drop will be observed in prices.

Will prices go up?

1. There is also a greater chance that crude oil prices will rise in September. According to experts, the main reason for the rise in crude oil prices is the increase in interest rates by the Federal Reserve. Thanks to this, crude oil prices will receive support.
2. Apart from this, OPEC has already made a point of pointing in this direction. If the price of crude oil falls to $70 or less, the organization will postpone the decision to increase its production and continue to cut output. Therefore, prices may rise.
3. Tensions in the Middle East have not subsided. Due to the war of words, prices are still under control. Any day that either side uses weapons, the supply of crude oil will be disrupted and prices will rise.

Will petrol and diesel become cheaper?

The most important question is whether petrol and diesel prices will come down or not. The answer to this question depends on whether or not the Brent crude price comes close to $65 per barrel in the month of September. If the prices fall further, we may see a reduction of Rs 5 per litre in petrol and diesel prices. If the prices rise, the prices will remain the same as they have been since mid-March. The last fall in petrol and diesel prices was on March 15. The government had made a cut of Rs 2.

What do the experts say?

According to Anuj Gupta, Head of Commodity Currency at HDFC Security, Brent crude oil prices are going to decline in the month of September. Prices may also rise by $65-68 per barrel. Many factors are behind this. He said that OPEC is planning to cut production. Libya’s production problem is about to end. At the same time, demand from the world’s two largest economies is lower. In such a situation, a reduction of Rs 3-5 in the price of petrol and diesel is possible.

On the other hand, Ajay Kedia, Director, Kedia Advisory and a commodity expert, said on TV9 Bharatvarsh that crude oil prices will not remain high for long. There are some absolute factors that are seen to support crude oil prices in the coming days. Which include tension in the Middle East, possible rate cut by the Federal Reserve and possibility of increased production cut by OPEC. On the other hand, despite rising stock markets, investment by foreign investors, continued inflow of mutual funds and falling dollar index, the rupee is holding at Rs 84. It clearly means that there seems to be little chance of the government and oil companies reducing petrol and diesel rates.

Gasoline and diesel prices in the country’s main cities.

1. New Delhi: Petrol Price: Rs 94.72 per litre, Diesel Price: Rs 87.62 per litre
2. Kolkata: Petrol Price: Rs 103.94 per litre, Diesel Price: Rs 90.76 per litre
3. Mumbai: Petrol Price: Rs 104.21 per litre, Diesel Price: Rs 92.15 per litre
4. Chennai: Petrol Rate: Rs 100.75 per litre, Diesel Rate: Rs 92.34 per litre
5. Bangalore: Petrol Price: Rs 102.86 per litre, Diesel Price: Rs 88.94 per litre
6. Chandigarh: Petrol Rate: Rs 94.24 per litre, Diesel Rate: Rs 82.40 per litre
7. Gurugram: Petrol Rate: Rs 95.19 per litre, Diesel Rate: Rs 88.05 per litre
8. Lucknow: Petrol Price: Rs 94.65 per litre, Diesel Price: Rs 87.76 per litre
9. Noida: Petrol Rate: Rs 94.83 per litre, Diesel Rate: Rs 87.96 per litre

Gasoline and diesel prices remained unchanged

After March 15, changes in petrol and diesel prices were seen only in Kolkata and Mumbai, but there was no change in Delhi and Chennai. Since March 15, there was a reduction of Rs 2 in the price of petrol and diesel across the country. After that, some states increased their taxes and some reduced them. So there has definitely been a slight change. If we talk about the profits of the oil companies in the last financial year, it was a record high. The three oil companies together made a profit of Rs 82,500 crore.

However, the research firm claimed that a two rupee cut in oil can reduce the profits of oil companies by Rs 30,000 crore. What is special is that compared to the same period last year, the profit for the first quarter of the current financial year decreased by 78 percent. The profit for the first quarter of last year was Rs 31,583.5 crore, which declined to Rs 6,919.98 crore in the first quarter of the current year. What is special is that HPCL’s profit has decreased by 94 percent.