India sees limited inflation impact from higher oil prices
India expects a limited inflation impact from rising oil prices as domestic prices remain low. Nirmala Sitharaman says the economy has a solid buffer for now.
The government of India does not expect a significant rise in domestic inflation despite a sharp increase in global energy prices triggered by conflict in the Middle East. Finance Minister Nirmala Sitharaman stated on Monday that domestic price levels remain near the lower end of the central bank's tolerance band, providing a buffer against the recent market volatility.
Global oil markets have seen Brent Crude Oil prices climb by approximately 26% in early trade, reaching their highest levels since July 2022. This surge followed the naming of Mojtaba Khamenei as the successor to the Supreme Leader in Iran, a move that comes amid military actions involving the United States and Israel. Supply concerns have intensified as major regional producers cut shipments due to safety risks in the Strait of Hormuz.
