![]() ![]() So, I think, it is not fair to compare one country to another and say they should be the same. But there are still many people in India that don’t have access to a lot of energy at affordable prices. India’s efforts in bringing electricity to its entire population have been very impressive. India is doing a lot of things to scale up. India’s economy and population are still growing. But India is coming from a different place. China is putting a lot of policies on electric vehicles, they want to be a leader in clean energy technologies and scaling of these. China’s economy is shifting from a very manufacturing driven, industrial driven economy to the service sector. For instance, China has gone through a very explosive phase for many years. When we look at the different projections for different countries, we have to stop and think where they are coming from. How should we interpret this contradiction between the trends in global oil demand and India’s oil demand? Global oil demand peak is likely in a few years’ time, whereas for India, the demand is expected to continue growing. If Russian supply, even partially, goes out of market for India, do you think there are enough alternate sources of supply that could swiftly replace Russian volumes? Urals recently breached the G7 price cap of $60 per barrel. Russian crude now accounts for over 40 per cent of India’s oil import volumes, which reflects a high level of dependency. Now, some of the production cuts are voluntary and it is a question then to balance supply with the demand to avoid a significantly tighter market. So, the market to us looks set to tighten quite significantly, which will obviously have an impact on prices. And we see limited potential of supplies increasing from other sources. So, we are still seeing strong growth and we are also seeing demand rising seasonally. We are still seeing demand rising structurally as we have recovered from the pandemic with growth in China and opening up of global aviation. And this is coming at a time when we normally see demand rising seasonally. Now, we see that there are additional voluntary production cuts taking effect this month, primarily led by Saudi Arabia, but also Russia has said it would reduce exports. In June, for instance, compared to last October, oil production was roughly the same. So, the 2 million barrels a day cut (by OPEC+ countries) has been offset. We have seen higher production from the United States, Iran, and a number of other producers. Since last October when those cuts were first put in place, we have seen increased supplies from other producers. So far this year, the oil markets have been relatively balanced despite a number of production cuts from OPEC (Organization of the Petroleum Exporting Countries) nations. What do you make of the current demand-supply scenario in the international oil market and its impact on prices in the near term? Also Read | The dramatic transformation of India’s oil trade with Russia, in seven chartsĬrude oil prices matter a lot to India as the country is heavily dependent on oil imports. ![]()
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