New Delhi: Indian refiners are sufficiently stocked, and both public and private fuel retailers are holding pump prices of regular petrol and diesel even as the country’s daily average import cost jumped 120% to record $156.29 a barrel since the start of the war in West Asia, government officials and company executives said on Sunday. The Indian basket of crude, surging to $156.29 a barrel, has set a new record, surpassing even benchmark Brent crude, which stood at $108.65 a barrel on March 19. (ANI)
The average price of crude oil purchase (called Indian basket) that was $71.17 per barrel just before the war broke on February 28, crossed $100 mark to settle at $120.28 a barrel on March 9, and started climbing thereafter to cross $140 by March 16 and crossed 150-mark to settle at $156.29 a barrel on March 19, according to the latest available government data.
The Indian basket of crude, surging to $156.29 a barrel, has set a new record, surpassing even benchmark Brent crude, which stood at $108.65 a barrel on March 19. To be sure, the Indian basket has often been a few notches below Brent in the past. Even last time, when Indian basket saw a peak at around $142 per barrel on July 3, 2008, it was about $4 below the Brent, which was around $146 a barrel.
Oil ministry’s data-keeper Petroleum Planning and Analysis Cell (PPAC) did not respond to a specific email query, asking the reason for Indian basket of crude prices surging above the Brent.
Despite surging crude oil prices, both public and private sector oil marketing companies (OMCs) continue to absorb high input costs without raising pump prices of regular petrol and diesel. To be sure, crude oil is the key input in the processing of petrol, diesel, and other petroleum products, accounting for about 90% of total refining costs.
“In view of the evolving situation in West Asia, the Government of India continues to take proactive steps to ensure preparedness and response across critical sectors,” petroleum ministry said in a statement on Sunday, giving daily update on the supply situation as the closure of the key sea route through the Strait of Hormuz has led to global energy supply disruptions and price escalations. “All refineries are operating at high capacity, with adequate crude inventories in place. The country is also maintaining sufficient stocks of petrol and diesel,” the statement added.
Private OMC, Jio-BP said their mobility stations are “fully operational to serve customers and are adequately stocked.” Interestingly, while state-run OMCs last week raised the price of premium petrol by ₹2 a litre, the private fuel retailer still held on to pump prices of both premium and regular petrol and diesel.
“Jio-BP continues to offer high-performance Active Technology Petrol and Diesel, which provide higher mileage at no extra cost, ensuring greater value for the customers,” the company said in a statement. Reliance BP Mobility Limited (RBML) operates the Jio-bp brand. Reliance Industries Ltd’s (RIL) Jamnagar refinery is the largest and most complex single-site refinery in the world, with 1.4 million barrels per day crude processing capacity.
With its diversified crude procurement strategy involving 40 oil-rich countries, India has no supply shortages of petrol and diesel, unlike several neighbouring countries such as Pakistan and Sri Lanka.
“No cases of fuel dry-outs have been reported at any of the ROs [retail outlets] by the Oil Marketing Companies. The Government reiterates its advice to the public not to resort to panic buying, as adequate stocks of petrol and diesel are available and supplies are being maintained regularly,” the petroleum ministry said on Sunday.
It, however, said that the supply of liquefied petroleum gas (LPG) is “still a concern” in view of the prevailing geopolitical situation. It reiterated that no dry-out has been reported for LPG distributorships for domestic cooking gas.
“Panic bookings have reduced. Delivery of domestic LPG cylinders is normal,” it said. The government is maintaining a full supply of cooking gas to over 330 million households by prioritising LPG supply to them and ramping up LPG production in public and private refineries.
The LPG supply crunch has led the government to prioritise the distribution of commercial LPG through states and local administrations. Demands for hospitals and educational institutions have already been prioritised. The government has already restored partial commercial LPG supply (20%) to consumers, and on March 18, it proposed allocating an additional 10% of commercial LPG to states based on ease-of-doing-business reforms for piped natural gas (PNG) expansion, the statement said.
On March 21, the government allowed another 20% allocation of commercial LPG to states, which would take the overall allocation to 50%, it said. “This additional 20% allocation shall be given on priority to sectors like restaurants, dhabas, hotels, industrial canteens, food processing/dairy, subsidised canteens/outlets run by State Govt. or local bodies for food, community kitchens, 5 Kg FTL for migrant labourers,” it said.
As about 47% of India’s total LPG imports are affected by Iran’s attack on Qatar’s Ras Laffan industrial city's energy infrastructure last week, India is sourcing the fuel from diversified sources such as the US, Russia, Australia, Canada, Norway and Algeria. On Sunday, an LPG cargo ship, Pyxis Pioneer, from the US arrived at the New Mangalore Port carrying 16,714 metric tonnes of LPG. This is in addition to a Russian crude oil tanker — Aqua Titan — heading for China, which was diverted to India. The ship carrying 0.77 million barrels of crude oil arrived in Mangaluru on Saturday.