Middle East Conflict Drives India's Fuel Prices Up Four Times; Analysts Fear Inflation

Central News Agency, New Delhi, May 25. The conflict in the Middle East has caused global oil prices to climb, and the prices of gasoline and diesel in India have risen four times in less than two weeks. Analysts are concerned that with the increase in transportation and logistics costs, the prices of food and daily necessities may follow suit. The conflict between the United States, Israel, and Iran has not officially ended, and the blockade of the Strait of Hormuz has not been fully lifted, causing a global energy supply shortage and keeping oil prices high. Since India relies on imports for over 80% of its crude oil, and with the conflict showing no signs of ending, the pressure on related companies is mounting, causing gasoline and diesel prices to rise continuously. The Economic Times of India pointed out that gasoline and diesel prices in India were first raised on the 16th, followed by two more hikes on the 19th and 23rd, and rose again today, marking the fourth hike in less than two weeks. After today's price hike, gasoline and diesel prices in Delhi reached 102.12 rupees and 95.20 rupees per liter, respectively. In Mumbai, they reached 111.21 rupees and 97.83 rupees; in Kolkata, 113.51 rupees and 99.82 rupees; and in Chennai, 107.77 rupees and 99.55 rupees. Sushma Rawat, Director of Exploration at the Oil and Natural Gas Corporation (ONGC), India's largest state-owned oil and gas exploration and production company, stated that the uncertainty caused by the Middle East conflict is causing crude oil prices to fluctuate violently. Rawat told the Asian News International (ANI) that "whenever (the US and Iran) announce a peace agreement, crude oil prices fall, but when the outside world realizes there is no real progress, oil prices rise again." Rawat noted that several policies proposed by the Indian government delayed the impact of rising international oil prices on the public by 76 days. During that period, domestic oil prices did not rise at all because related domestic companies were losing nearly 10 billion rupees (about 3.3 billion NT dollars) per day. "But how long can you expect such (government-subsidized) policies to last?" India Today reported that India's oil prices had remained relatively stable since April 2022, and this series of four hikes in two weeks is expected to continue to increase the economic burden on commuters, transporters, and even general businesses. Analysts warn that if gasoline and diesel prices in India continue to rise, it will inevitably pile up transportation and logistics costs, eventually forcing companies to pass the costs on to consumers, causing the prices of food and daily necessities to soar.