Rising oil prices unlikely to impact inflation: Experts

The spike in crude oil prices amid escalating tensions between Israel and Iran is unlikely to impact retail inflation, which hit a 75-month low in May, experts noted, citing stable fuel prices in India.Brent crude price surged above $78 per barrel before settling around $74 per barrel on Friday, amid fears of supply disruptions following Israel's strike against Iran. "When the crude oil price declined to $60 per barrel, the government did not pass the benefit to the consumers, hence there won't be any impact on inflation," said Madan Sabnavis, chief economist at Bank of Baroda.During the recent period of low crude prices, the government had not cut retail prices.The gains from higher pump prices were shared among the government, state authorities and oil marketing companies (OMCs), meaning that current price increases will primarily affect these entities rather than consumers, said Sabnavis."The risk to inflation remains low, as fuel prices have not changed for some time now," noted Gaura Sengupta, chief economist at IDFC First Bank.However, Paras Jasrai, associate director at India Ratings and Research, warned, "If the conflict between the two countries escalates further, then this could spring up crude oil price beyond $80/bbl, which can put a stop to the disinflationary trend that India has been witnessing".