Saturday, March 12, 2011
Oil Price Hike, Boon or Bane ?
Experts consider that the Stock Market and Oil Market are retrograding back to the state of 2008, when acute Recession was observed.
Oil had peaked to $140 per barrel then. Then the main causative factor was the economic crises in almost all developed countries.
Today the main cause is the unrest in all oil producting countries. Oil price may go to the Resistance Level of $140 !
Meanwhile, Obama has opined that increased demand for cooking gas and oil from the BRIC nations ( Brazil, India, China and Russia ) is responsible for the oil price hike. These economies are fast, developing economies and they need more oil and gas. Obama was addressing the media about the oil price rise.
If in 2008, oil price hike was due to recession in many countries, today the cause is that some countries ( BRIC nations ) are developing fast !
At the moment, India is on a growth curve with exports expected at $ 230 billion and imports at $ 317 b. A deficit of 87 b ! Indian exports crossed the 200 b mark in the first eleven months this fiscal. Feb exports was over $ 20 b.
The growth of the export sector, therefore, will be 50%, as India exported around $ 160 b last year.
India is planning to increase exports to the tune of $ 450 b in three years. But then what will be the figure of imports ?
So a robust 8.6 % growth is forecast for the Indian economy. Astrologically, India is under the favourable Jupiterian transit till May 6th and the benign Saturnine transit till Nov 15. After these dates are over, India will be facing adversity. Jove in the 10th and Saturn in the 4th gives scope for alarm and despondency. We do not know how the oil price rise will affect India. As India imports 70% of its oil requirement, she may be adversely affected by the oil price hike !