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By:

Akhilesh Sinha

25 June 2025 at 2:53:54 pm

Oil crisis: India's resilience on edge

Workers load LPG cylinders in a truck, in Chikkamagaluru, Karnataka on Tuesday. | Pic: PTI New Delhi: The Israel–US–Iran war's oil shock, with prices at $116/barrel, Hormuz blockade, and recession fears, threatens global depression per Wood Mackenzie and IMF warnings. India buffers via 8-week reserves, Russian imports, and steady fuel prices, prioritising diplomacy and "Nation First" amid opposition clamour and geopolitical shadows from China–Russia manoeuvres. The escalating Israel–US–Iran...

Oil crisis: India's resilience on edge

Workers load LPG cylinders in a truck, in Chikkamagaluru, Karnataka on Tuesday. | Pic: PTI New Delhi: The Israel–US–Iran war's oil shock, with prices at $116/barrel, Hormuz blockade, and recession fears, threatens global depression per Wood Mackenzie and IMF warnings. India buffers via 8-week reserves, Russian imports, and steady fuel prices, prioritising diplomacy and "Nation First" amid opposition clamour and geopolitical shadows from China–Russia manoeuvres. The escalating Israel–US–Iran conflict has triggered a global oil crisis that now threatens to plunge the world into recessionary depths. On the tenth day of the war, the International Monetary Fund has urged policymakers worldwide to brace for the fallout, evoking fears of a supply shock dwarfing the 1970s oil embargo. The blockade in the Strait of Hormuz has stranded around 200 oil tankers at sea, including 37 Indian vessels, crippling a route that carries 22% of global oil shipments. India sources nearly 50% of its crude oil and LNG through this vital passage, heightening risks to its energy security. Crude prices have skyrocketed to $116 per barrel by day ten, a 60% leap from $72–73 on February 28, when markets were sliding. Attacks on energy infrastructure have exacerbated the chaos: Iran deployed drones against oil and gas facilities, refineries, and storage in Saudi Arabia, Kuwait, Bahrain, the UAE, and Iraq, targeting major refineries in Saudi Arabia and Bahrain, which are key global export hubs. Israel retaliated by striking Iranian oil depots. Anticipating the growing dangers of war, Saudi Arabia, Iraq, Kuwait, and the UAE have reduced production in certain oil fields. Recession Warnings Mount Amid soaring oil prices, Scotland-based Wood Mackenzie has warned of a global recession stemming from this war. Its report asserts that if the conflict persists for 15 days, the world economy could slide into a great depression, driven primarily by an oil crisis eclipsing the 1970s shock, and echoes of 1929 haunt the markets. IMF Managing Director Kristalina Georgieva has warned that if oil prices rise by around 10% throughout the year and hold steady, global inflation could climb by about 0.4%. She added that world output might decline by 0.1 to 0.2% as a result. Rising oil and gas prices tend to have the most profound impact on the global economy. Price Pressures Fuel prices have spiked globally: 14% in the US, 6% in Britain, 15% in Australia, 10% in South Korea and China, 20% in Pakistan (petrol at 321 PKR per litre), 22% in the Maldives, and 15% in Sri Lanka, but have increased only by Rs 60 for domestic Indian consumers. If crude oil prices remain above $100 per barrel for an extended period, petrol and diesel prices in the country could rise by 5–6 rupees per litre. Higher oil costs will inflate freight charges for goods, directly impacting everything from food prices to industrial output. Geopolitical Shadows Energy experts foresee prices hitting $150–200 per barrel if the war drags on, amplifying inflation and economic strain. India's Finance Ministry voiced concerns in its monthly review meeting but highlighted ample forex reserves as a buffer. Unanswered questions loom: how long can Iran sustain the fight? Will Gulf states stay neutral? Are Russia and China seeking to prolong this war through indirect support? China has deployed its spy warship to the Arabian Sea, positioning it perilously close to the conflict zone. Beijing remains continuously linked to Iran through its rail–road corridor. India's prudent stockpiling and non-aligned stance, echoing its Ukraine playbook of pushing peace over partisanship, position it as a beacon of stability. While the world teeters, New Delhi is focused on energy security and citizen welfare.

Uddhav’s big heart: No, possible future threat

Updated: Nov 7, 2024

Uddhav

Mumbai: Shiv Sena (UBT) on Monday decided to give away three seats in Raigad district – Alibaug, Pen and Panvel – to Peasants and Workers party (PWP). Sources believe that the decision has come after the party president Uddhav Thackeray realised that PWP may cause a bigger harm to his party in the long run if it is not accommodated in the Maharashtra Vikas Aghadi (MVA).


Shiv Sena (UBT) and PWP both were struggling to arrive at a consensus over the crucial seats in Raigad, Solapur and Nanded districts. PWP had claimed six assembly seats of which four are from Raigad district (Alibaug, Pen, Panvel and Uran) and one each from Solapur (Sangola) and Nanded (Loha Kandhar) districts.


PWP has a strong hold over four seats of Raigad district and Sangola seat of Solapur. PWP had demanded six seats while in talks with the MVA and subsequently declared candidates for all of them on October 22. Next day, Shiv Sena (UBT) also went ahead and declared candidates for those seats.


The controversy arose from attempts by top MVA management to settle scores with smaller allies. Experts believe that Thackeray felt that PWP didn’t support their candidate, Anant Geete, enough during the Lok Sabha elections, leading to his defeat. This led to Thackeray withdrawing support from PWP General Secretary Jayant Patil during the legislative council elections.


Thackeray’s decision to leave the crucial seats for PWP seems to be politically driven one, purely because of PWP’s moves during the Lok Sabha elections.


The PWP has fielded Chitralekha Patil in Alibaug, Atul Mhatre in Pen and Balaram Patil in Panvel. Chitralekha had recently donated cycles to 22000 girls so that they could reach their schools and colleges comfortably. Her political debut marks the Patil family’s fourth generation’s involvement in the politics of Alibaug.

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