Chandigarh. Union Petroleum and Natural Gas Minister Hardeep Singh Puri said on Tuesday that there is no shortage of crude oil in the world and there is enough refinery capacity in the country to meet domestic needs. Referring to the ongoing tension in West Asia, Puri said that it is his personal assessment that things will soon become normal. It is in everyone’s best interest not to allow things to get blown out of proportion as this will affect everyone.
Speaking separately during a program organized here regarding the ‘Employment Fair’, he said, “There is no shortage of crude oil in the world.” Puri said, “Before all these activities, the total amount of crude oil produced in the world was around 105 million barrels per day. The Organization of the Oil Exporting Countries and its allies (OPEC Plus) have voluntarily cut the price by about 5 million barrels (per day).
He said, “If you talk to them, they will say that it is not their job to deal with prices. But if you limit the quantity coming into the market then you are clearly influencing the prices. “Due to production cuts, the quantity has come down to 97 million barrels.” Puri said, “Again there is tension at the global level. If there is tension in a particular area, what effect will it have on oil…This increases the cost of freight, increases the cost of insurance.”
He said, “How do you calculate oil prices? “In the international price of crude oil, you add insurance cost, freight cost, refinery margin and dealer margin.” The minister said, “And in all this we still have one of the lowest prices of petrol and diesel in the world. The reason for this is that the government has reduced the central excise duty on two occasions in November, 2021 and May, 2022.”
He said, “Today there is no shortage of oil. Despite all the tensions including Iran and Israel, today oil prices should be around $72-73 per barrel. The market is taking these things into consideration.” Puri also said that there is no shortage of refining capacity in India.
The minister said, “There is enough crude oil available in the market, there is enough refinery capacity and we have a very good distribution network. We have a very good arrangement with them. That is why there is nothing to be suspicious about in this matter.” Puri said that new oil is coming in the market. Brazil is getting 4,00,000 barrels of additional oil per day. America can bring more oil into the market.