Indian oil producers, refiners to gain from unrest in Mid East, Africa
04 Mar 2011
Crude oil prices rose to $116 per barrel on 2 March 2011, the highest level in more than two years.
Political unrest in Middle East and North Africa (MENA) - that is raising a larger concern over disruption in Organization of Petroleum Exporting Countries (OPEC) oil supplies from the region - could fuel further price increases.
This sharp increase in global crude oil prices will improve the realisations of Indian private sector oil production companies, and the margins of refiners.
However, government-owned oil companies, on the other hand, will have to contend with a heavier subsidy burden that will curtail profit increase.
Political unrest in Middle East and North Africa has led to a sharp upswing in crude oil prices since the last week of January 2011.
Protests in Libya have sparked concerns that the violence might spread to neighbouring countries such as Saudi Arabia and Iran.