PM Modi Warns Oil Producers Over High Crude Prices Hurting Global Growth

Lloyd Doyle
October 16, 2018

This is ominous for producers as India is the third-largest oil consumer in the world and is seen driving incremental demand over the next decade.

India, the world's third-biggest oil importer, is facing record high retail prices as global crude rate soared and rupee value dipped.

"The oil market is producer driven and both the quantity and prices are determined by the oil-producing countries".

Union Ministers Arun Jaitley and Dharmendra Pradhan and Vice-Chairman NITI Aayog Dr. Rajiv Kumar also present on the occasion.

"Though there is enough production, the unique features of marketing in the oil sector have pushed up the oil prices", it said quoting the prime minister.

Similarly, petrol prices in Mumbai, Kolkata and Chennai also rose on Sunday - to Rs 88.18 in Mumbai, Rs 84.54 in Kolkata and Rs 85.99 per litre in Chennai.

India plans to build two strategic storage facilities to hold 6.5 million tonnes of oil costing around 110 billion Rupees ($1.6 billion) through a joint partnership between an Indian state firm and private company.

Interacting with CEOs and Experts from Oil and Gas Sector from India and overseas in New Delhi, the Prime Minister drew their attention on certain key policy issues relevant to India. India is dependent on imports to meet 83 per cent of its demand and more than half of its natural gas requirements.

The rupee, which is now Asia's worst-performing tender, has lost around 14 percent of its value against the American currency this year.

Modi highlighted the economic hardships higher oil prices bring to consuming countries like India, and sought capital and technological support from producers to raise local output.

The prime minister also made a strong case for a partnership between producers and consumers in the oil market, as it exists in other markets, which would help stabilise the global economy, as per the statement.

Modi's first meeting was on January 5, 2016, where suggestions for reforming natural gas prices were made. More than a year later, the government allowed higher natural gas price for yet-to-be-produced fields in hard areas like deep sea. He said the support of oil producing companies would be very critical to bridge the gap.

Sources said Saudi Oil Minister Khalid A Al Falih, BP CEO Bob Dudley, Total head Patrick Fouyane, Reliance Industries Chairman Mukesh Ambani and Vedanta chief Anil Agarwal are expected to attend the meeting on Monday.

Other reports by Iphone Fresh

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