India-OPEC Institutional Dialogue: Dharmendra Pradhan stresses for no 'Asian Premium'
| Updated: Aug 23, 2017 11:20 IST
Vienna [Austria], May 22 (ANI): Union Minister of State for Petroleum and Natural Gas Dharmendra Pradhan visited Vienna for co-chairing the 2nd India-Organisation of the Petroleum Exporting Countries (OPEC) Institutional Dialogue at the OPEC headquarters and strongly reiterated that as a large import destination there should be no 'Asian Premium' on the crude supplied to India and Asian buyers. Pradhan highlighted that India provided timely payments and honoured all its contractual commitments and demanded due acknowledgment through discount in prices for large volumes that India imports. The minister further added that for a long time OPEC subsidised western buyers at the cost of Asian buyers. Given the importance of Asian market for OPEC, particularly fast growing Indian market which stood by OPEC as a reliable and continued customer, Pradhan demanded 'Asian Dividend rather then paying Asian Premium'. He also informed about the increasing refining capacity of India and future expansion plans. He also briefed OPEC about the expanding petrochemical sector in India. Pradhan highlighted the fact that the Energy Mix in India is undergoing major changes with renewables coming in a big way and pricing of solar energy coming down to 4 cents per unit. There is also a shift in focus to solar, wind, biomass, Electric Vehicles, Hybrid cars etc. He emphasised that the oil Industry is at a delicate cross road and higher crude prices will give a further push to renewables. Pradhan also stressed that the OPEC should work towards "Responsible Pricing" which is important for India for socio-economic and developmental reasons. It would allow India to provide energy to the common and marginalised people who have been deprived of access to energy so far. Higher crude prices would retard growth rate which will result in slowing down the demand of crude oil. On the proposed plan of continued production cut by OPEC and non-OPEC countries, Pradhan said that energy security was a full circle. He said that while the production cut is an attempt to arrest the slide in prices, however, it also has an inherent chance of under investment and consumer's needs not being met in the long run, which is not in the interest of a balanced and healthy global oil and gas market. Pradhan met the Secretary General of OPEC Mohammad Sanusi Barkindo and discussed bilateral issues of interest at a delegation level dialogue. He highlighted the importance of India - OPEC engagement and discussed on the effects of the production cut of 1.8 mbpd by OPEC and non-OPEC countries on the global oil market volatility. Pradhan said that India had been and continued to be a reliable customer of OPEC countries, the only big economy where the demand for crude oil continues to rise each year. About 86 percent of India's import of crude oil, 70 percent of natural gas, 95 percent of LPG are from OPEC countries. Pradhan also underlined the importance of market and reiterated the need to intensify bilateral dialogue to change the nature of engagement from a buyer-seller relationship to an Energy Partnership. He added that in today's oversupplied market, it was important for producers to understand the perspective of consumers and the demand centres and the changes that have taken place in these demand centres. The meeting took place two days prior to the OPEC Ministerial meeting that is scheduled from May 25. Pradhan was accompanied by Secretary Petroleum, Indian Ambassador in Vienna and CEOs of seven large refiners of India, both from public and private sector including IOCL, HPCL, BPCL, MRPL, HMEL, Reliance and Essar. The CEOs emphasised their points of view during the OPEC meeting. (ANI)