Oil Crisis Alert: America has taken a temporary step to deal with the energy crisis as oil prices cross $100 due to Iran war. It has allowed countries to buy Russian oil, so that the supply of oil remains in the market. This discount is limited till April 11.
Washington: Due to Iran war, oil prices are skyrocketing in the international market. The Trump administration has taken a big decision to deal with this crisis. America has allowed countries to buy Russian oil and petroleum products. This step was taken when the price of Brent crude oil crossed $ 100 per barrel for the first time since August 2022. US Treasury Secretary Scott Besant said that this is a temporary permission, so that the Russian oil ships stuck at sea can be purchased.
Has the Iran war created a new global energy crisis?
Experts believe that this conflict related to Iran is not just a military tension, but it is directly impacting the global energy market. About 20 percent of the world’s total oil supply passes through the Strait of Hormuz. This is the reason why the closure of this route immediately created a stir in the international market. If this situation continues for a long time, oil prices may increase further. This may also affect the prices of petrol and diesel, transport expenses and inflation.
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Will this bring big economic benefits to Russia?
American officials claim that Russia will not get major economic benefits from this decision. He says that the real income of the Russian government comes from taxes on oil production. Since this oil has already been loaded onto ships, its sale is unlikely to generate additional revenue for Russia. However, some analysts believe that this decision is part of a strategy to keep the energy market stable, so that a sudden supply crisis does not have a major impact on the global economy.
Why did America allow buying Russian oil?
The Treasury Department has made it clear that this is only a short-term step taken so that the supply of oil remains in the market. This exemption will be applicable only to those Russian crude oil or petroleum products which have been loaded on ships till March 12. The last date of this license is 11th April. Scott Besant also claimed that the main income of the Russian government comes from taxes imposed during oil extraction. Therefore, selling the oil that is already in the sea will not bring any major economic benefit to Russia. US Treasury Secretary Scott Besant said that this decision is not permanent. This has been implemented only as a temporary relief measure (Short-Term License). Its main objective is to ensure that the supply of oil in the international market does not suddenly reduce.
Why is the Hormuz crisis important?
The Iran war is now going on for the second week. Due to this the Strait of Hormuz has been closed. This route is very important because one-fifth of the world’s oil is supplied from here. For this reason, oil prices are on fire. Economic experts believe that even if the war ends soon, there is little hope for the immediate opening of the Strait of Hormuz. To deal with this serious energy crisis, America is now ready to be soft on Russian oil.