Barack Obama seems to be as yet unable to convince other global leaders to back an invasion of Syria, where the brutal regime could have used chemical warfare against civilians. But the oil markets have been jittery, and prices have climbed for four weeks in a row.
The state of the global oil market should worry Indian policymakers who have until now stayed focused on the other big component of the trade gap: gold. There has been some stray talk about the possibility of buying oil from Iran by paying in rupees.
Rising global oil prices are a worry for two clear reasons. One, they will feed inflation, especially since the rupee has also fallen in value. Two, the trade gap could grow just as there are hopes of at least a mild export revival. A lot of attention is on what Ben Bernanke will do later this month, but it is time that more attention is also paid to how Obama plays the Syria game.
Source:- livemint.com
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