State-owned oil firms have term contracts - guaranteeing a fixed volume of oil in a year - with national oil companies of West Asian nations for the import of crude oil. Not just price, India also wants better commercial terms like optional volumes in yearly supply contracts and larger time to pay for oil bought. It is the only nation that is seeing growth in oil demand on a sustained basis and without it the producers will also suffer, the official said.
India is 85 per cent dependent on imports to meet its oil needs and relies on overseas shipments to meet 55 per cent of its gas requirement. Consequently, high oil prices will hurt demand recovery. While the world has begun the transition towards cleaner fuels such as electric-powered vehicles and hydrogen, most nations are still dependent on oil to fuel their economies. "He (Puri in his previous meetings) conveyed in no uncertain terms the need for oil prices to be stable and within limits, else the economic recovery witnessed the world over will suffer," the official said, adding oil prices above USD 65-70 per barrel will hurt importing nations. Saudi and UAE oil ministers besides the OPEC secretary-general are expected to participate in the meeting. India is again likely to raise the issue of high oil prices when global leaders meet for the India Energy Forum by CERAWeek later this week. He conveyed India's strong preference for responsible and reasonable pricing which is mutually beneficial for consumers and producers, the official said. Puri, in his meetings with the Secretary-General of OPEC and his counterparts in Saudi Arabia and other nations, conveyed India's serious concerns over crude oil price volatility.
Oil Minister Hardeep Singh Puri has in recent weeks flagged the issue of high oil prices to Saudi Arabia, the UAE, Kuwait, Qatar, the US, Russia and Bahrain, the official said. International benchmark Brent crude has since rallied to USD 85.67 per barrel. The demand recovered this year as vaccination against the infection revived economies world over.
International oil prices had crashed to USD 19 per barrel in April last year as demand evaporated with most nations clamping lockdowns to control the spread of COVID-19.
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