Published: Tue, October 10, 2017
Money | By Armando Alvarado

India looks at strategic partnership with oil producers

India looks at strategic partnership with oil producers

Oil prices were mixed on Monday with global benchmark Brent Crude down 0.50% recently, while USA crude West Texas Intermediate was unchanged after some comments from OPEC officials signaled that the group and other producers may take further action to restore market balance.

"The Prime Minister emphasised the need to move the engagement to a strategic partnership, going beyond the buyer-seller relationship", he said, adding that "all major producers, Saudi Arabia, Russia, the U.S., all have recognised the massive scale of India's energy engagement".

"And once we are able to restore the balance, that equilibrium price will materialise and that will be of the best interest of the global economy", he said.

Barkindo said consultations were underway for the extension of the OPEC-led pact beyond March 2018 and that more oil producing nations may join the supply pact, possibly at the next meeting of OPEC in Vienna on November 30.

The move is said to spell doom for oil demand as the world turns to electric cars.

Oil prices edged higher today as the Organisation of the Petroleum Exporting Countries (Opec) confirmed the market was finally rebalancing and called on United States shale oil producers to help efforts to reduce supply.

"There is clear evidence that the market is rebalancing", OPEC's secretary general Mohammad Barkindo says.

Woman Travels With Cash To Help Hurricane Victims In Puerto Rico
Apart from structural damage and a shortage of necessities like food and water, roughly 90 percent of the island remains without electricity.

The demand for crude oil in India is expected to grow by over 3 per cent in 2017 at around 4.5 million barrels per day. This, he said, would be the pathway to achieve stability and materialise equilibrium prices.

"There are many factors helping to foster, strengthen and support the deepening relationship between OPEC and India", he said.

Some analysts suggested that USA exports would help fill the void left by Saudi Arabia.

US crude oil inventories fell by 4.08 million barrels last week, the American Petroleum Institute said on Tuesday, far more than expected while gasoline supplies gained 4.91 million barrels and distillates eased by 584,000 barrels. Analysts at Capital Economics said refiners are merely replacing shipments from elsewhere in favor of cheaper USA crude.

CEOs and top officials from Rosneft, BP, Reliance, Saudi Aramco, Exxon Mobil, Royal Dutch Shell, Vedanta, Wood MacKenzie, IHS Markit, Schlumberger, Halliburton, Xcoal, ONGC, IndianOil, GAIL, Petronet LNG, Oil India, HPCL, Delonex Energy, NIPFP, International Gas Union, World Bank, and International Energy Agency were present at the meeting. "What's more, higher US exports are likely to encourage USA shale producers to further increase production which will delay market rebalancing". "This is a market of investment priority and not a choice anymore", Nasser said at the Indian Energy Forum by CERAWeek.

-Neanda Salvaterra contributed to this article.

Like this: