News
India tells OPEC it must be sensitive to needs of oil consuming nations
Summary
- Noting that it is the sovereign right of oil producing and exporting countries to decide their production capacity, petroleum minister Hardeep Singh Puri said their decisions are still subject to “the doctrine of consequences - intended and unintended”
New Delhi: With oil prices on the boil, union petroleum and natural gas minister Hardeep Singh Puri has asked the Organisation of the Petroleum Exporting Countries (OPEC) to be sensitive to the needs of oil-consuming nations and curb output cuts. Taking to X, formerly Twitter, Puri said he discussed the global energy scenario during his meeting with OPEC secretary general Haitham Al Ghais on Tuesday.
"Discussed the global energy scenario in my meeting with OPEC SG, HE #HaithamAlGhais. India imports about 60% of its crude oil worth $101 billion & other petroleum products from OPEC members. I highlighted how ensuring access to affordable energy is a must for social upliftment," he said.
In another tweet, the minister wrote, "During the pandemic, when crude oil prices crashed, the world came together to stabilize the prices to make it sustainable for the producers. Now, as the world is at the cusp of economic recession & slowdown, oil producers need to show the same sensitivity towards the consuming countries."
Noting that it is the sovereign right of oil producing and exporting countries to decide their production capacity, the minister said the decision is subject to "the doctrine of consequences - intended & unintended".
The statement comes as crude oil prices have been hovering over $90 a barrel as the OPEC+ grouping and its major members – Saudi Arabia and Russia – have resorted to constant production cuts to lift prices.
Last month Saudi Arabia announced it was extending its voluntary oil production of one million barrels per day (bpd) till December. Russia also voluntarily extended its decision to cut production by 300,000 bpd till the end of 2024. These cuts are over and above the reduction of 1.66 million bdp announced by OPEC in April.
Brent prices have eased in the past couple of sessions after surpassing $97 per barrel mark last week. At the time of writing this, the December contract of Brent on the Intercontinental Exchange (ICX) was trading at $90.68 per barrel, down 0.03% from its previous close.
India is a net importer of crude oil and imports around 85% of its energy requirement, so an increase in international crude oil prices severely affects inflation in the country. India's retail inflation is currently above the Reserve Bank of India's (RBI’s) upper tolerance level of 6%. In August retail inflation eased to 6.83% from 7.44% in July.
On Monday, Puri met Patrick Pouyanne, chairman and CEO of TotalEnergies, and invited the company to participate in bids for hydrocarbon exploration in India. "Happy to meet Chairman & CEO of @TotalEnergies Mr @PPouyanne in Abu Dhabi. Discussed ways to expedite the Mozambique project, India’s largest energy investment abroad. Also invited them to participate in the bidding for the one million sq km ‘no go’ area now open for exploration," he wrote in a tweet.
