Fuel price cut held hostage by volatile oil, rupee fall and inflation

NEW DELHI: A cut in domestic fuel prices has been held hostage to the volatility in the global oil market and the sharp fall in the rupee’s value against the Greenback due to interest rate hike by the US central bank.
Benchmark Brent crude dropped $3.74 a barrel to $86.72 on Friday as the rate hike made the dollar stronger, making it costly for traders to buy oil, amid mounting fear of demand contraction due to recession.
Even reports of China’s oil demand rebounding and supply concerns over the latest Russian move to up the ante against Ukraine failed to stop oil prices from sliding.
This is the second time that Brent, which makes up about a quarter of India’s oil imports, has dropped below $90 per barrel to hover at 7-month lows. It is a far cry from the stratospheric $139 a barrel, highest since 2008, reached soon after the Ukraine conflict began on February 24.
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