As brent crude oil prices hit $80 per barrel for the first time since late 2014 on looming US sanctions on Iran, the impact on India is not far away since it imports nearly 80 percent of its oil consumption from abroad.
Other factors that contributed to oil price rise are plummeting Venezuelan production, and strong global demand.
The oil prices rose about 1.9 percent last week.
The oil spike began after United States announced that it would withdraw from the 2015 Iran nuclear arms treaty and renew sanctions against the OPEC (Organisation of petroleum exporting countries) member.
Donald Trump had made this announcement on May 8.
The European Union (EU) wants to salvage the 2015 nuclear deal, which offers Iran relief from economic sanctions in exchange for curbs on its nuclear programme.
Europe sees the agreement as an important element of international security.
In India, petrol prices in Delhi on Saturday are Rs 75.91 per litre, while the diesel prices are Rs 67.31 per litre.Oil Price Hike In India.
Five Things to know1.
Though India's oil imports from Iran surged in the month of April, Union Oil Minister of India Dharmendra Pradhan said on May 12 that it is too early to say how the US sanctions on Iran will impact India.2.
India is more than 80 per cent dependent on imports to meet its oil needs India's net oil import bill in 2017-18 was $70 billion.
Last fiscal the trade deficit had widened to reach $160 billion level from $40-50 billion in the previous year, he added.3.
Rising global oil prices may push up India's import bill by up to $50 billion, impacting current account deficit, but would have little effect on growth, Economic Affairs Secretary Subhash Chandra Garg said on Friday.4.
India's oil imports from Iran surged to 640,000 barrels per day (bpd) in April, its highest level since October 2016, according to data from shipping and industry sources, as refiners raised purchases ahead of looming U.S.
sanctions against Tehran.
Iranian Oil Minister Bijan Zanganeh said on Saturday that US President Donald Trump's decision to quit a multinational nuclear deal would not affect Tehran's oil exports if the EU could salvage the pact.5.
Petrol prices have risen by about a rupee per litre since Monday when state-owned fuel retailers resumed daily revision in retail prices after a 19-day pre-Karnataka poll hiatus.
The BJP-led government had raised excise duty nine times -- totalling Rs 11.77 per litre on petrol and Rs 13.47 on diesel -- between November 2014 and January 2016 to shore up finances as global oil prices fell, but then cut the tax just once in October last year by Rs 2 a litre.
(With inputs from Reuters, PTI)