As India continues to be a large importer of crude oil, a change of even USD 1 per barrel will impact the country's import bill by Rs 6,160 crore, says India Ratings (Ind-Ra).

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According to the ratings agency, if the organisation of the petroleum exporting countries (OPEC) and its allies decide to hold their supply, oil prices are likely to rebound.

"This will increase India's import bill as it meets over 80 per cent of its demand through imports, and a change of even USD 1 per barrel will impact the country's import bill by Rs 6,160 crore," it said.

According to Ind-Ra, Brent crude oil price, the global benchmark for crude prices, continued its upward trajectory to hit a four-year high of USD 86.07 per barrel on October 4 this year, as the market grappled with the expected loss of oil supply from sanction-hit Iran.

From mid-October 2018, however, an increase in supply led to a gradual decline in brent crude oil prices.

Furthermore, the US waived off such sanctions on November 3 for eight countries, including India and other major importers of oil from Iran.

Subsequently, the prices dipped to USD 72.68 per barrel on November 5, down 14.6 per cent month-on-month, on fears of a glut in the market.

The declining trend was reversed again when Brent crude oil prices increased on November 12 on an announcement by Saudi Arabia that it would cut its exports by 500,000 barrels per day in December, and speculations that the Opec will slash output in 2019.

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"Russia and Saudi Arabia are the largest exporters of oil globally, while the US produces only about 11.5 million barrels a day. Therefore, if the Opec and its allies decide to hold their supply, oil prices are likely to rebound," it said