Oil prices soar as Russia Ukraine conflict intensifies

Oil prices on Tuesday rose in India and abroad as geopolitical tensions over Ukraine escalated, raising fears of disruption in supplies from Russia, the second-biggest producer of the commodity.

The April crude contract (Brent) came perilously close to the $100 per barrel mark, its highest level since September. The spike came on the heels of Russian President Vladimir Putin recognising the separatist controlled Donetsk and Luhansk as autonomous entities in eastern Ukraine and ordering his troops to enter the region, which in turn is expected to result in economic sanctions.

According to reports, the US has banned import of all goods from the two regions in eastern Ukraine and also halted business activities; Russia could now retaliate by reducing its deliveries which will be debilitating for European Union given its high level of dependence on Russian oil and gas. Result: The Shares of BPCL fell over 3 per cent on Tuesday. FM ON RISING PRICES FM Nirmala Sitharaman said on Tuesday that the increase in crude prices is a challenge.

The increase was discussed at the meeting on financial stability. "We will keep a watch on it," she said. "The prime minister had cut fuel tax before Diwali in response to calls from the public.

The problem is that fuel prices are high because of global supply issues," she said, adding, "What oil marketing companies do with fuel prices, I cannot answer," she noted.

According to reports, the US has banned import of all goods from the two regions in eastern Ukraine and also halted business activities; Russia could now retaliate by reducing its deliveries which will be debilitating for European Union given its high level of dependence on Russian oil and gas. Result: The Shares of BPCL fell over 3 per cent on Tuesday.

FM on rising prices

FM Niramala Sitharaman said on Tuesday that the increase in crude prices is a challenge. The increase was discussed at the meeting on financial stability. "We will keep a watch on it," she said. "The prime minister had cut fuel tax before Diwali in response to calls from the public. The problem is that fuel prices are high because of global supply issues," she said, adding, "What oil marketing companies do with fuel prices, I cannot answer," she noted.