- Kapoor said that the group of oil refiners would initially be meeting once in a fortnight and exchange ideas on crude purchases
- OPEC+ should realise that this is not the right approach, they must step up production, said the Petroleum Secretary
New Delhi: India is considering forming a group of PSU and private oil refiners to seek better crude oil import deals, Petroleum Secretary Tarun Kapoor has said. Oil marketing companies (OMCs) of India can form joint strategies and can even go for joint negotiations, wherever possible, Kapoor has been quoted as saying by Reuters. The statement comes in the backdrop of soaring fuel prices in India and the Centre’s efforts to cut down India’s crude oil import bills.
India is the world’s third-largest oil importer and consumers and depends on imports for meeting around 85 percent of its crude oil requirements. Kapoor said that the group of oil refiners would initially be meeting once in a fortnight and exchange ideas on crude purchases.
Crude oil prices are not sustainable: Kapoor
While remarking that crude oil prices are not sustainable, Kapoor said that the Organisation of the Petroleum Exporting Countries (OPEC) and its allies should ease production curbs to cool down global crude oil prices. “OPEC+ should realise that this is not the right approach, they must step up production. If the demand is going up and you are not increasing production, you are trying to create a gap. Due to this, prices are going up and that’s not fair. These kind of prices are not sustainable,” said the Petroleum Secretary.
Recently, OPEC and its allies decided to stick to the plan to increase November crude oil output by 400,000 barrels per day (bpd) as it looks to phase out output curbs of 5.8 million bpd over time. Kapoor said that rising crude oil prices would prompt oil consumers to seriously start thinking of shifting to “other forms” and curtail demand for OPEC oil. “High oil prices are spurring investment in upstream activities, that could lead to higher production from regions other than the Gulf,” said the top bureaucrat.
State-run refiners have already started cutting down the share of OPEC crude oil in their import basket and are increasingly seeking oil from areas other than the Gulf. They have also invested billions of dollars in upgrading refineries so that they can process crude oil of varying grades. Refiners also already negotiate some crude oil purchases jointly.
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