New Delhi: Worried over the impact of crude price volatility on the economy, Finance Minister Arun Jaitley on Friday hoped that the situation in the Middle East would improve leading to stabilisation of oil prices.
"I am sure the last word on the economy of the oil has not been spoken yet. There are assessments, there are speculations, there are words of wisdom. We are passing through very fluid times and I would always hope that this fluidity settles down and the moderation comes to stay," he said at 'Urja Sangam' conference here.
He was commenting on the volatility in the international oil market following attack by Saudi Arabia and its allies on rebels in Yemen.
Crude oil prices soared about 5 per cent yesterday on fears of impact on supplies. However, the Brent crude prices fell 90 cents to close at USD 58.29 a barrel in today's trade.
The Minister said such events are beyond control and "we become the recipient of circumstances. This is one sector which in the last two months have seen one of the largest movements".
The volatility in crude prices, Jaitley said, adds to the unpredictability of the economic situation and the other consequence is flow of "disproportionate" amount from consuming economies to producing nations.
In case of India, he said, the decline in oil prices in the last few months have encouraged the companies to pass on the benefit to the consumer.
"The oil companies in India and the Oil Ministry, in the last few months have taken very responsible positions. Huge benefits have been transferred to consumers, this has helped us in containing inflation... Which in turn has reversed the need of the increasing interest rates," Jaitley added.
Yemen has border with key Middle East oil producers Saudi Arabia and Oman.
Concerns are being expressed that escalation of the crisis could disrupt oil shipments passing through the Bab el-Mandeb Strait, located between Yemen and Djibouti. As much as 3.8 million barrels of oil are transported from this route every day.
