Bengaluru, Jun 17 (PTI) The Federation of Karnataka Chambers of Commerce and Industry (FKCCI) on Tuesday expressed deep concern over the recent surge in global crude oil prices, which have climbed above USD 78 per barrel amid escalating tensions in the Middle East--specifically the ongoing conflict between Iran and Israel.

Such volatility is exacerbating costs across all sectors of Indian industry and intensifying inflationary pressures on trade and consumers, it said.

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"As a nation reliant on oil imports for more than 80 per cent of our energy needs, India is particularly vulnerable to external supply shocks," FKCCI president M G Balakrishna said in a statement.

According to him, a spike in oil prices has already weakened the rupee--sliding to approximately Rs 86/USD--and added strain to the balance of payments and inflation outlook.

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Industrial stakeholders across manufacturing, logistics, chemicals, and agri-processing sectors are facing sharp cost escalation due to higher input, freight, and fuel expenses. Furthermore, food inflation is exacerbated as energy costs trickle down through the supply chain.

The FKCCI president urged the Government of India to take prompt and decisive measures to alleviate the burden on businesses and consumers.

He suggested the government to authorise the accelerated drawdown of India's Strategic Petroleum Reserves--currently sufficient for 10 days of consumption--to stabilise immediate supply and prices.

Other suggestions include implementing a short-term reduction or suspension of excise duties on petrol, diesel, LPG and jet fuel to buffer industries from cost shocks following global precedents, enhance capacity and access to refined petroleum product reserves to bolster supply chain resilience.

The FKCCI president has proposed government to extend working capital lines at reduced rates for energy-intensive SMEs to manage cost inflation and recommended fast-track policy roll-out and incentives for renewable energy and fuel-efficiency upgrades to reduce long-term oil dependency.

"These steps are vital to shield Indian industry from external shocks, secure trade competitiveness, and support national economic stability. The government must act swiftly to uphold investor confidence and safeguard livelihoods," Balakrishna added.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)