The familiar wail and anxiety over oil is back again. For a nation that is fixated on growth and cheers every basis point boost to the GDP, we have done little all these decades to reduce our dependence on crude imports. It stays adamant at 80 per cent. We struggle to balance our Budget as crude rules high, much as oil export economies feel similar trauma when prices are low. Our current dilemma over oil is hence not new to trouble us, cyclically.
That said, for four-plus decades now, the global economy has been linked to the state of oil demand and pricing. As global trade peaked so did crude. Elevated oil prices had been co-terminus with a surge in economy and trade. Energy-related economic sectors carry trillions of dollars in investments and a liquid gold-led economy deflates with fall in crude prices. The era of liquid gold is alive, despite our huge attention on non-renewables. The global economy was awaiting an oil price rebound, that is seen as an indicator of resurgence in growth, the absence of which has caused far more economic disruption in comparison to that caused by higher crude prices.
R Narayanan Navi Mumbai
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