Let us be realistic here: the IEA has said that major oil fields are in decline, leading to supply constraints in the future. Crude oil price oscillations are therefore here to stay. Exposing citizens to market prices may seem to be a convenient pre-election decision, but this too could rebound badly on the vulnerable in days to come. One intelligent option is to go with a floor for oil prices, so that the citizenry doesn’t have to deal with the gyrations.  

The government needs to come clean on their intent in contemplating this decision. Are they willing to stick by it? I am not talking about sticking by it no matter what. All that must be asked is: Are they willing to let market rates prevail as long as crude prices are in the range they have been in the last six months?  

The writer is a Hyderabad-based economist and oil watcher

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