Opec should release excess capacity to bring down oil prices: Indian minister

Opec should release excess capacity of five million barrels per day into the market and make the prices affordable, a top Indian minister said.

The international oil benchmark has risen by more than 60 per cent this year and petrol prices in India have crossed 100 rupee-mark.

“The prices of petrol and diesel, which have been set by Opec+, have not been set because there is a shortage in the market that can be addressed if available five million barrels capacity will be used to calm the market. It is a conscious decision by them individually and collectively as part of Opec+,” Indian Minister of Petroleum and Natural Gas Hardeep Singh Puri told Khaleej Times.

“I don’t go to oil producing countries and ask them to reduce the prices. It’s not my job to tell them,” he said.

While participating in the Abu Dhabi International Petroleum Exhibition and Conference (Adipec), Puri has held meetings with his counterparts from Saudi Arabia, UAE, Kuwait and Russia to name a few.

Asked about the flurry of closed-door meetings, he clarified that there is no difference of opinion.

“I tell you very frankly, many of the countries, which are constituents of Opec+ totally agree with me when I talk. They realise that if they don’t do it, there will be a price to pay. Energy today is a critical component of economic activity. Especially when you are in a process of economic revival, after a debilitating lockdown, which became a slowdown and resulted in calibrated opening, energy as a critical component and the price becomes a critical factor.”

India net-zero plan by 2070

The minister termed India’s plan to go net-zero by 2070 as a “very ambitious, bold” but it is not a choice any more but an “imperative” target to meet.

Puri noted the energy transition will be a gradual process and has to be jointly managed.

“It is in the interest of the consumers to have an orderly transition, which is predictable and stable, and for the producers as well. If the transition is not orderly or not according to the predictable line, the volatility and disruption, which will take place in the markets can result in all manner of other consequences. You are already seeing some of the results of that,” Puri said during his visit to the Abu Dhabi office of Engineers India Limited, which is marking 25 years.

Puri underlined India will have massive additional areas for oil exploration and production by 2025.

“We are going to be stepping up on the accelerator on exploration and production in a very big way.”

Also, India aims to expand its gas pipeline network to 34,000 kilometres.

“In gas pipeline alone, we are expecting a $60 million investment. We are increasing the area under exploration from 0.25 million sqkm to 0.5 million sqkm and then to one million sqkm.”

The minister underlined that the bilateral relations with the UAE continue to get stronger.

“It’s very positive. This relationship is set to intensify and grow stronger.”

He added that the Engineers India Limited have served well in the UAE. “They have got lot of projects. I will encourage them to scale up, broaden their horizons, the best is yet to come,” Puri added.

— ashwani@khaleejtimes.com