India to Benefit on Oil GOLD TOUCHES NEW HIGH OF . 26K

As Markets Roil Globally, 

Equity selloff cools crude; petrol price may come down if Brent stays soft

Petrol prices in India will fall for the first time in two-and-ahalf years if global crude oil prices, which have sunk to a sixmonth low, do not bounce back. Brent crude tumbled below $100 a barrel on Tuesday from a peak of $127 in April, while US crude oil, which usually trades well below Brent, plunged to $76 as the market was spooked by fears that oil demand would crash if the global economy slows down. Trade was volatile and both grades recovered a few dollars from the lowest point. Crude oil's fall mirrors the global rout in stock markets as investors were rattled by the cut in US credit rating and the debt crisis in Europe. Investors flocked to gold, which is regarded as a safe bet in tumultuous times as its value is not dented by sovereign debt, credit ratings or economic growth. 
Gold jumped to a record $1,778 per ounce (28.35 gm), in its biggest three-day rally since the financial crisis in late 2008. In India, the world's biggest gold buyer, the precious metal scaled a peak of . 26,000 per 10 gm. The rupee's fall to an 11-week low supported the rally. 
The chaos in international commodities and equity markets is a blessing for inflationweary India and its beleaguered oil companies. Indian consumers have borne the brunt of nearly a dozen hikes in petrol price since the fuel was decontrolled in June last year. Petrol in Delhi has risen to . 63.70 per litre from about . 48 in April 2010. 
Lower crude costs would also wipe out revenue losses in diesel and cut the subsidy bill for cooking gas and kerosene. 
"We will definitely look at revising petrol prices in case this downward rally in crude oil price continues, but we have to wait and watch and see how sustainable this rally is and how long it lasts… We are monitoring prices closely and are likely to take a decision soon," said S Roy Choudhury, CMD, Hindustan Petroleum 
Corporation. SK Joshi, director (finance), Bharat Petroleum Corporation, 
agreed. "Given that petrol price has been deregulated there is a definite case for a downward revision in case crude oil continues to plunge and we are closely observing the price movements, especially as sometimes after a sharp plunge crude tends to bounce back vigorously," he said. 
The fall in international crude prices is a welcome respite for oil companies, which have been on the verge of sinking into the red due to state controls on prices of kerosene, LPG and diesel.