The Ukraine crisis has caused a global humanitarian crisis, while the economy has suffered badly. The Brent crude has already touched $118.
The implications of the present crisis have unfolded difficulties for our country. As per RBI data, our foreign exchange reserves have depleted rapidly. The apex bank has already sold our forex reserves, in line with the accounting principle that was adopted in 2019.
Recently, our markets were facing the crisis cross as the US was already amending the interest rates, causing foreign investor’s sell from Indian markets.
The crisis has further deepened with the oil prices shock and now the ban on Russian oil, by the USA. This doesn’t auger well for our economy, though our crude oil is mostly sourced from the Gulf region, the US ban shall further increase the Gulf oil demand, globally.
The rupee has breached the crucial 77 mark against the US dollar as crude prices are going beyond the first-ever rise after the 2008 crisis. The solution to the huge oil import bill, therefore, needs to be openly discussed with the average Indian, who can help evolve the solution, by agreeing to reduce the daily needs for fuel.
The per capita oil consumption is the lowest amongst the growing economies but considering the uncertainties, post-Ukraine crisis, and never-seen embargos and sanctions on Russia, the oil import bill will continue to dent our economic stability.
Considering these facts, the immediate solution is to install solar farms by individual homeowners, which will reduce the electricity requirements, and also the common man will have to economize his fuel spending to serve the barest needs. There is an immediate possibility that petroleum prices may go up, though the Government has assured not to let that happen.
Indian Oil and other gas companies are already geared up to meet the challenge. However, the Government is already spearheading a campaign to make the common man aware of various energy-saving techniques, through various sponsored programs, called Saksham, held every year from January 16 to February 15. This year this program was rescheduled due to the third wave of Covid and will be held in the first week of April.
The writer, with a background in the oil and gas upstream sector, opines that the uncertainties of war and its economic impacts can be reduced largely through such public movements and, therefore, urges all the readers to follow all energy-saving guidelines of the Government.
The rising crude prices will add to the petroleum products and therefore the WPI, as well as IIP, may be affected. This is a quiz that needs an extremely calculated step on whether to release our strategic reserves or increase the prices.
The time is ripe to conserve as the Petroleum Ministry is going to celebrate Saksham, which will be the single biggest contribution by Indian citizens, in choosing public transport and other energy-saving measures.
