The energy situation in India saw some significant announcements recently. The country is expecting to raise its natural gas price by 44 percent.

Mr Buffet was speaking to shareholders of his Berkshire Hathaway company at their annual general meeting being held in Omaha, Nebraska. The value of Berkshire Hathaway’s investments fell by quite a bit and Mr Buffett’s personal wealth shrank by $25bn (£17bn) and he is now not at the top of the richest person list.

A short term investors should invest in debt products as they give assured returns. On the other hand, if investors are prepared to wait for least three years, they can look at equity. But they need to invest in a staggered manner. For instance, look at daily and weekly STP’S (Systematic Transfer Plans).

As per many Guru’s on TV inflation is likely to surge to 17% by September 2008. The government is likely to hike prices between 10 and 20% again, as early as September to limit fiscal risks. The rise in the price for the Indian crude oil basket could be the trigger for another round of increase in fuel prices to $145 to 150 per barrel from the current $132 per barrel.

The rising prices of commodities, such as food grains and natural resources has led to a sharp cut in real income. The Governments, all over the Globe, are in a panic situation and they are desperately trying to find a break through in the rise in prices. In India, investors have started to benefit in terms of global diversification.

It should be pretty clear after the Iraq incident that United States is playing the oil game all over again but in a different way now. And this is the desperate gamble of a country whose economy is neck deep in trouble.

The crude oil prices have almost been doubled and rupee is slowly reaching to a level where it was in the late 2006. The crude oil has to certainly fall, otherwise, it will cripple the economy of India.

It is difficult to say whether we are witnessing a bubble in oil markets, today. One can invest in an over-valued asset, if one has good reason to think that one can take the profits and run before the burst.