Global oil prices are on the rise, and if the trend continues for some more time, customers could see an increase in the retail prices of petrol and diesel.
In Asian trade on Thursday, Brent crude for November was up 21 cents to $51.54 per barrel, while the US benchmark West Texas Intermediate for November was up 23 cents to $48.04.
In the last few days, Brent crude prices have gone past $52 a barrel from $47 just a few days ago. In line with global prices, the Indian crude basket, which was at $50.33 a barrel on Wednesday, even though the rupee-dollar exchange rate has remained more or less stable during this period.
Indian oil marketing companies review prices every fortnight. On September 30, while diesel prices went up by Rs 0.50 per litre, petrol rates were kept unchanged. The next fortnightly review would be on October 15.
Analysts cite a number of reasons for this rebound in crude prices, including a forecast by the US Energy Information Administration (EIA) that US crude production could decline to 8.86 million barrels per day (bpd) next year from 9.25 million bpd at present. This could mean a further rise in crude futures.
According to the EIA forecast, global crude supply is expected to go up to 95.98 million bpd in 2016, while demand would be around 95.2 million bpd, mainly due to rising demand from China.
“World oil demand is estimated to increase by 1.5 million barrels per day in 2015,” Abdalla Salem El-Badri, secretary-general of the Organisation of Petroleum Exporting Countries said.