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IEA Warns Saudi Arabia’s Oil Production Cut Plan To Tighten Indian Economy
The International Energy Agency (IEA) warns of a potential burden on the Indian economy due to Saudi Arabia’s oil production cut plan, predicting tight global markets in the second half of the year.
In response to a question about the potential impact of Saudi Arabia’s oil production cut on countries like India, stated, Fatih Birol, Executive Director of, the International Energy Agency told ANI, “India is a country that imports energy and oil. The majority of the oil consumed in India is imported. Such a move could result in an increase in India’s oil import bill, posing a burden on the Indian economy and consumers.”
On Saudi Arabia’s announcement of cutting oil production, Birol stressed, “Saudi Arabia, Russia and others- the OPEC plus producers decided to cut the oil production. And when we look at the International Energy Agency’s analysis and the analysis of almost every serious institution looking at the oil markets, the second half of this year markets would be all very tight.
Birol added that he finds this decision risky for the global economy.
Commenting on the effectiveness of the ban on Russian oil, Birol stated that it depends on the objective. “Since February 24, when the war started, today, the Russian oil and gas export revenues declined, dropped by 60 per cent. If we consider that the oil and gas export revenues are a very important input for the Russian budget, this is a major challenge for the Russian economy.”
Fatih Birol acknowledged that India has been identified as a key country that imports crude oil and then re-exports refined oil to European countries. He stated that he considers this to be a legitimate action.
When discussing the impact of Ukraine’s war on the energy sector, Birol emphasized that renewable energies promote peace.
He further noted that Russia, which is currently the world’s largest natural gas exporter, is facing increasing competition as more countries are producing and exporting gas. Birol anticipated that the influx of liquefied natural gas (LNG) into the markets in the next few years would likely lower prices and alleviate concerns .
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