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India’s Russian crude imports prevented price surge, ‘havoc’ in global oil market, says petroleum ministry
Global crude oil prices would have surged and created “havoc” in the international oil market had India not ramped up oil imports from Russia in the aftermath of Moscow’s February 2022 invasion of Ukraine, the petroleum and natural gas ministry told the department-related parliamentary standing committee.
“If they (Indian refiners) had not imported Russian oil into India, which may be a big number of 1.95 million barrels per day, that deficiency would have created a havoc in the crude oil market and the prices would have shot up by about $30-40,” a petroleum ministry representative was quoted as saying in a recent report of the standing committee on petroleum and natural gas. The report was tabled in Parliament on December 20.
“The crude oil market is such that in the market of 100 million barrels per day, if the OPEC (Organization of the Petroleum Exporting Countries) says that they are going to reduce it by one or two million barrels per day, prices increase by 10 to 20 per cent and reach up to $125-130. If India does not absorb–I would call it absorption–1.95 million barrels per day, these prices would have reached $120-130. It would have created a havoc,” the petroleum ministry representative added. The report did not name the representative. Usually, senior bureaucrats of the petroleum ministry represent the ministry before the standing committee.
India is the world’s third-largest consumer of crude oil and depends on imports to meet over 85 per cent of its requirement. The country has a refining capacity of over 250 million tonnes per annum, or 5 million barrels a day.
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