Gold, Fuel, Edible Oil Prices in India to Rise Over Ukraine-Russia War

In a surprise move, Russian President Vladimir Putin on Thursday announced war on in Ukraine." I have made the decision of a military operation to protect the people of the Donbas separatist region," he said in a statement on television. Putin appealed to Ukrainian soldiers to lay down their arms and go home.  India has called for de-escalation of the situation at the UN Security Council. Impact of the Russian invasion of Ukraine will have an impact on India in relation to several products including fuel and edible oils.

Fuel Hike

As per a report published in Deccan Herald, the industry watchers have stated that there will be a huge increase in gas prices as the crisis has increased the price of brent crude closer to $100 per barrel, the highest since 2014.

Crude and related products account for over 9 per cent in the Wholesale Price Index, due to which a spike in brent crude prices will worsen inflation in India as Russia accounts for around 17 per cent of the global natural gas production. Oil accounts for around 25 per cent of India's total imports, with over 80 per cent of oil imported in the country.

Subsequently, prices of LPG, CNG, and even electricity may see a spike.

The same will be the case with petrol and diesel prices which are already high after the 2-year COVID impact.There is a possibility of an increase of more than Rs 10 to 12 in fuel prices.

Edible Oil

The sunflower oil prices in India will also be increased as Ukraine and Russia together meet about 90 per cent of India’s sunflower oil needs. Any delay in shipment, leading to shortage can spike up the prices of edible oil which is an essential oil in the country.

Gold, precious metals

Precious metals, such as gold, as well as those used in industries, are expected to be hit hard by the Russia-Ukraine conflict.

Palladium, used in automotive exhaust systems and other technologies, such as smartphones, will get costlier as Russia is the top global exporter.

Meanwhile, gold, which is dear to Indians, is already getting costlier after Putin decided to deploy troops in the breakaway regions of Donetsk and Luhansk.

Also Read: Gold Prices Soar As Russia-Ukraine Conflict Deepens

Other important metals like aluminum, cobalt, and copper will also be hit as  Russia accounts for approximately six per cent of global aluminium supply, 3.5 per cent of the global refined copper production, at 9.2 lakh tonnes in 2021. Russia produced 7,600 tonnes of cobalt last year, more than 4 per cent of the world total, according to the US Geological Survey.