Brace for a possible increase in petrol prices soon. The geopolitical tension in Iraq has sent Brent crude prices soaring to a nine-month high of approximately $115, amid concerns that escalating violence may disrupt global oil supplies.

US crude oil was up to $107.22 per barrel on supply concerns. Although analysts and oil experts say the current rise in crude prices is just a knee-jerk reaction to the escalating tension in the region, elevated crude rates in the international market are not good for a net oil-importing country like India.

India imports close to 85 per cent of its crude requirement, and Iraq is one of its major suppliers. A further spike in prices is likely to have economic implications. “If the current tension persists and crude prices go up further, the possibility of which is not ruled out, it will push up petrol prices and also put a break on diesel price de-regulation in the near future,” said an oil expert. Government sources said an elevated diesel under-recovery due to rise in crude prices would increase the subsidy burden further for the new government.

As militants closed in on Iraq’s capital Baghdad, crude prices surged, even as shares of oil-marketing companies like BPCL, HPCL and IOC tanked 5-8 per cent. ONGC lost 1.5 per cent and Reliance Industries declined over 1 per cent. Cairn India slipped 2 per cent. Gail lost 3.6 per cent at the close of trade on Friday the 13th, considered inauspicious by many.

Besides the Iraq crisis, the depreciation of the rupee against the dollar is another worry, according to market experts.

The rupee depreciated 52 paise to end at 59.77 against the dollar on Friday. This was its sharpest daily fall since January 24, 2014, when it had dipped by 73 paise in a day.