Indiainfoline | India looks to diversify its sources of crude oil purchase

Oct 17,2022

In order to protect itself from any unexpected output reductions by the Organization of the Petroleum Exporting Countries and its allies, India said that it will accelerate the diversification of its oil imports.

In response to an OPEC+ decision last week to reduce output by 2 million barrels per day, India's oil minister Hardeep Singh Puri stated on Friday, "This will harm huge importers like India, who spent over $120 billion last year on the import of petroleum goods."

India, the third-largest consumer and importer of oil in the world, procures roughly 85% of its requirements from abroad, and as its economy expands, so will the country's energy requirements.

Puri said at GeoIndia 2022, "Some diversification has already occurred, and we will further diversify. There are various sources, and we will not hesitate to take action."

The globe might enter a recession as a result of output cuts, he continued, even though they might momentarily increase revenue for OPEC+ producers.

"They (OPEC+) have the sovereign right to make that decision. But it's also my responsibility to emphasise that all such activities have effects, whether they're meant or not "added Puri.

Since April, state-run Indian fuel merchants have not increased pump prices, and Puri predicted that the nation will be able to navigate the terrain "confidently."

According to Puri, Indian businesses have fresh oil supply agreements with Colombia and Brazil and are looking to invest in oil-producing properties abroad.

After OPEC+ announced that it would cut its production target against U.S. objections, relations between the United States and Saudi Arabia, two historic friends, are at an all-time low.

Indian state refiners momentarily stopped importing oil from the kingdom last year as a result of output reductions by OPEC+, led by the Saudis, who are also angry with the monarchy for demanding an Asian premium on oil exports.

"We have historically made use of the considerable autonomy we have as importers and consumers. We won't think twice about using that autonomy to influence events in a way that will guarantee our populace's access to affordable and secure energy supply "said Puri.

Since a few years ago, less oil from the Middle East and OPEC has been imported by India overall.

Puri added that sales discounts are what fuel India's oil imports from Russia. He continued, "The discounts on Russian oil have now shrunk."