MUMBAI: For a country that imports the lion’s share of its oil requirements, high prices are never good news. So, when Brent crude prices rose to over $75 a barrel, there was some worry on the Street.
NSE’s volatility index (India VIX), often referred to as a fear gauge, surged to a three-year high of 24.6 on Tuesday. Analysts said this was due to a combination of high oil prices and the anxiety surrounding the ongoing general elections. Also, the rupee breached the 70 mark against the dollar.
While oil prices have receded to about $72.15 a barrel, it must be noted that they are about 34% higher so far this year. The rise in oil comes against the backdrop of unimpressive corporate results, low job creation, a slowdown in domestic consumption, fears of a subpar monsoon and muted private sector capital expenditure (capex).
