Key Points
Vandana Hari explains the risk premiums and speculative factors driving oil prices up, emphasizing $70-75 as a comfortable range for India..
She cautions against the negative impact of a weak rupee and high oil prices on the Indian economy's growth.ETMarkets.com..
And while, arguably India can pay $80 and throughout last year, we saw the prices were much higher through 2023 and yet the Indian economy did very well, inflation was much higher as well and India still managed and not only that, Indian oil consumption continued to grow in 2023..
Vandana Hari: Yes, I think the rupee depreciation is a double whammy for the country because crude prices are high and now refiners are going to have to fork out much more in rupee terms to buy the same barrel of oil..
Longer term, especially if these twin pressures remain concurrently present, the rupee continues to be weak and oil prices continue at current levels or God forbid, they go even higher, it will definitely have a dampening effect on the Indian economy...
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