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India’s crude facts
OPEC production cuts and the prospect of more expensive oil are pushing India to consider US and Canadian suppliers, India warned.
OPEC production cuts and the prospect of more expensive oil are pushing India to consider US and Canadian suppliers, India warned. India demanded a discount from the Organization of the Petroleum Exporting Countries (Opec) at the second India-Opec Institutional Dialogue at Vienna on Monday. Opec is a grouping of 13 oil producing nations. India is world's third-largest oil consumer.
It imports about 86% of crude from the OPEC countries. The 23 refineries in India process 235 million metric tonnes (MMT) of crude annually or 4.7 million barrels per day capacity. India imports 4 million barrel per day of crude and refine it and market it both in domestic and international markets. India’s consumption was about 194 million tonnes in 2016-17 as against 148 million tonnes in 2012 fiscal. It’s indigenous production was 35.6 million tonnes in 2012 and it fell to 34.8 million tonnes last fiscal.
The energy mix in India in the last 3 years has changed with renewables coming in a big way and pricing of solar energy coming down to 4 cents per unit. There is huge pressure to shift focus to solar, wind, electric vehicles, hybrid cars etc. India’s annual refining capacity is 235 MMT of which 194 MMT of products are consumed domestically, while the rest is exported. Energy consumption is expected to double in the next 15 years. India is a net exporter of gasoline, naptha, jet fuel and gas oil.
It is in the process of increasing refining capacity around 310 MMT by 2023. It is planning to invest about $ 80 billion in petrochemicals. India’s per capita energy consumption is 0.55 tonnes of oil equivalent, which is far below the global average of 1.9 tonnes. India’s energy consumption is expected to grow to almost double by 2035. The government is adding 14,000-km gas pipelines to the existing 16,000 km pipelines. India is mulling oil from the US. Shale gas used to be above $60 a barrel.
Now it is around $40. India feels these factors shall be considered by Opec to reduce prices and offer discounts to it. The international crude oil price of Indian Basket was $ 52.98 per barrel (bbl) on 22nd May as against $ 52.30 three days earlier. Global oil prices crossed $53.8 on Tuesday.
