As multiple geopolitical facets converge to raise tension, global trade, and one of the most fundamental elements of trade, crude oil prices are appearing to be getting affected. In a recent development, the price of the benchmark Brent crude surged by over 2 per cent.
Crude Oil Prices Jump
The brent crude Brent crude, also known as Brent blend, is a type of crude oil extracted predominantly from the North Sea oil fields of Brent, Forties, Oseberg, and Ekofisk (BFOE).
This is one of the most traded oil benchmarks in the world.
Reuters
With this surge of 2.43 per cent or USD 1.92, the price of Brent Crude jumped and crossed the USD 80 mark again, reaching USD 80.94 per barrel.
Tension in the Middle East is owing to Israel and Iran-allied force's escalation in conflict and the recent message from the Hezbollah leader, while the ongoing conflict has led to greater concerns over trade and availability of trade and the supply of crude.
This is because, apart from being important sources of crude oil themselves, these nations also play an important role in protecting pertinent trade corridors, including the Strait of Hormuz.
Another factor that is cited by some is the US Federal Reserve and the Jerome Powell-led central banking system's decision to slash interest rates, come September. In addition, China, the largest importer of oil in the world, and its economic performance are also reasons for concern.
Oil Company Shares Drop
Major Indian state-owned oil corporations also saw a decline in the fortunes at Dalal Street.
Hindustan Petroluem Corp Limited or HPCL, ended the day with a decline of 0.26 per cent or Rs 1.05, closing at Rs 404.00 per share on August 27.
The Indian Oil Corp Limited, however, gained 0.16 per cent or Rs 0.27, dropping to Rs 173.19 per share by the end of the day.
When we come to another state-owned oil company, Bharat Petroleum Corp Ltd or BPCL, was the biggest loser, declining by 0.93 per cent or Rs 3.25, closing at Rs 347.90 per share.
There was some silver lining at the end of the day, as of the largest non-renewable company, ONGC ended in green, gaining 0.18 per cent or Rs 0.60, closing the day on Rs 328.45 per share.
