Saturday, May 14, 2022

Govt has conveyed India’s concerns over crude oil price volatility to OPEC: Minister

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  • The government has conveyed India’s strong preference for responsible and reasonable crude oil pricing, said the minister
  • OPEC has projected that the oil demand in India is expected to reach around 11 million barrels per day (mbpd) by 2045

New Delhi: The government has been taking up the issue of crude oil price volatility bilaterally and has conveyed India’s concerns to crude oil producing countries regarding the matter and India’s strong preference for responsible and reasonable pricing, Minister of State (MoS) for Petroleum and Natural Gas Rameswar Teli told the Rajya Sabha on Monday. “Government has been taking up the issue, bilaterally with crude oil producing countries with OPEC and with heads of other international fora to convey India's serious concerns over crude oil price volatility, and India’s strong preference for responsible and reasonable pricing for consumer countries,” said Teli in a written response to a question in the Upper House of Parliament.

India’s crude oil demand projected to reach 11 mbpd by 2045

Teli told the Rajya Sabha that the World Oil Outlook 2021, a flagship publication by Organisation of Petroleum Exporting Countries (OPEC), has projected that the oil demand in India is expected to reach around 11 million barrels per day (mbpd) by 2045 as compared to approximately 4.9 million barrels per day in 2021.

Elaborating on the government’s plan for ensuring energy security for India, Teli said, “The government is taking various steps to provide for the country’s  energy security… through, inter alia, increasing domestic production of oil and gas in all States of India, diversifying import sources to new countries and regions; and diversifying energy sources beyond traditional hydrocarbons’ to emerging fuels like Ethanol, Compressed Bio Gas, Hydrogen etc through schemes such as Ethanol Blending Program (EBP), Sustainable Alternative Towards Affordable Transportation (SATAT) etc.”

Backdrop

The news comes as Brent crude has jumped by around 20 percent in 2022 to hover around more than $93 per barrel. The rise has come as global consumption remains strong despite the spread of Omicron variant of the COVID-19 virus. The volatility in global crude oil prices has caused India’s import bill to swell by two times year-on-year in the nine-month period of FY22 as over 80 percent of the domestic requirement for oil is met through imports.

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