Key Points:
- International crude oil prices have dropped to a 4-year low, currently around $60.23 per barrel.
- India, which imports over 86% of its crude oil, could save up to ₹1.8 lakh crore on oil and LNG imports if the trend continues.
- Petrol and diesel prices are expected to fall in the coming weeks, offering significant relief to Indian consumers.
- ICRA projects crude prices to remain between $60-70 per barrel for FY 2025-26.
- Domestic oil producers could see profits rise by up to ₹25,000 crore due to stable, lower input costs.
New Delhi: Indian consumers may soon see a welcome drop in petrol and diesel prices, according to a new report by leading rating agency ICRA. The prediction comes as international crude oil prices have softened to their lowest levels in four years, hovering around $60.23 per barrel this week.
Huge Savings on Energy Imports
India, the world’s third-largest oil importer, relies on foreign sources for more than 86% of its crude oil needs. In the financial year 2024-25, the country spent a staggering $242.4 billion (over ₹20 lakh crore) on crude oil imports alone. If the current downward trend in global oil prices continues, ICRA estimates that India could save up to ₹1.8 lakh crore on crude oil and liquefied natural gas (LNG) imports in the current fiscal year.
What’s Driving the Price Drop?
The global crude market has seen increased supply and softer demand, pushing prices to a four-year low. Uncertainties in global demand and expectations of further supply increases have also contributed to the downward pressure. For India, about half of its LNG demand is met through domestic production, but $15.2 billion was still spent on LNG imports last year.
Relief for Consumers and the Economy
ICRA projects that if crude oil prices remain in the $60-70 per barrel range through FY 2025-26, Indian oil marketing companies could see their profits rise by up to ₹25,000 crore. More importantly for everyday consumers, this could translate into lower petrol and diesel prices at the pump in the coming weeks.
LPG Prices May Also Drop
With global energy rates softening, there is also potential for a reduction in LPG (cooking gas) prices, providing further relief to households across the country.
If the global crude oil price trend holds, Indian consumers and the economy stand to benefit significantly. Lower fuel prices would ease household budgets, reduce inflationary pressures, and help the government manage its energy import bill more efficiently.
