There is turmoil in the global markets these days due to the Middle East war. Because of this, crude oil prices are skyrocketing. Crude oil, which had touched the scary level of $119 per barrel some time ago, may have come down a bit today, but there is no concrete hope of relief. This situation is choking the economies of the entire world.
A year’s leap in a single month
If we look at the figures, the nervousness of the market is clearly understandable. At present, the price of American benchmark WTI crude remains around $ 94.99 per barrel. At the same time, Brent crude is at the level of $ 102.65. Even though on a daily basis there has been a slight decline of around one percent, the real matter of concern is something else.
The price of crude oil which used to be between 65 to 75 dollars before the war started, is still above 100 dollars. The most shocking thing is that within the last one month, the prices of crude oil have increased by more than 43 percent. This increase is almost as much as is usually seen in an entire year (42-45%).
A deep attack on the world’s supply chain
The root of this entire problem lies in the geographical region of West Asia, which is the largest center of crude oil for the entire world. Whenever tension increases in this region, there is a danger of an immediate brake on global supplies. Due to the war, the risk to cargo ships on sea routes has increased manifold. Apart from this, in an environment of uncertainty, investors also start withdrawing their money. Due to all these reasons, there is a sudden and sharp rise in prices, which is not easy for any country to handle.
The heat of this war will reach your pocket
When crude oil becomes expensive in the international market, the ultimate economic burden falls on the shoulders of the common consumer. Its first and direct impact can come in the form of rising prices of petrol and diesel. If fuel becomes expensive, the cost of freight and transportation will also automatically increase. This simply means that items of daily use, fruits, vegetables and other essential items can also become expensive soon. In such a situation, this situation can increase inflation, due to which maintaining economic balance will become a big challenge for the governments.