US-Iran Tensions Send Crude Oil Prices Soaring, Impacting India's Economy

Crude oil prices have continued to be volatile due to ongoing tensions between the US and Iran, which has led to increased pressure on India's economy. The conflict in West Asia has resulted in a surge of over 2% in crude oil prices, with Brent crude climbing to around USD 90.60 per barrel and WTI crude rising to around USD 85.50 per barrel.

The impact of this volatility is being felt in India, where petrol and diesel prices remain largely unchanged at Rs 102.12 per litre and Rs 95.20 per litre respectively in Delhi. In Mumbai, petrol prices are at Rs 111.12 per litre, while diesel is retailing at Rs 97.78 per litre.

With India being an oil-importing economy, sustained pressure on crude oil prices means higher inflation risks for the country. The latest government data shows that food inflation rose to 4.45% in July, while food prices increased to 5.52%. Higher prices of essential items such as onions and eggs contributed to the increase in food inflation.

The Supreme Court is set to hear a PIL seeking mandatory labelling of ethanol content in petrol at fuel stations, which could further impact the fuel prices.