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India aims to step up domestic crude oil output to cut imports

Hardeep Singh Puri, Minister for Petroleum and Natural Gas

Petroleum Minister Hardeep Singh Puri said on Friday that India would be stepping up its domestic production of crude oil to  meet 25 per cent of  demand by 2030. Currently India, which consumes five million barrels of petroleum daily, imports about 85 per cent of its total crude requirements. 

India’s demand for fuel has seen a steady jump of 3 per cent, which is higher than the global average of around just 1 per cent. The increase in production will be critical for the government to save foreign exchange reserves and control inflationary pressures.

With rising economic uncertainties across the world, the challenge for India’s policymakers is to ensure growth picks up while inflation is maintained at a reasonable level.

Inaugurating the three-day South Asian Geoscience Conference Geo India at Sitapura, Puri said that the ethanol-blend percentage in petrol has increased from 0.67 per cent in 2013 to 10 per cent in May – the target has been met five months ahead of schedule. This has helped in reducing 2.7 million tonnes of CO2 emissions, thus supporting a clean environment.

As per the International Energy Agency (IEA) estimates, India will contribute a quarter of the growth in global energy consumption in the coming two decades. Oil and gas major BP estimated that India’s energy demand will double, while natural gas demand is expected to grow five-fold by 2050.

The third largest consumer of oil, India’s net import bill for oil and gas was $14.9 billion in July 2022 compared to $8.0 billion in July 2021. India is importing Russian oil at a price significantly cheaper than Saudi Arabia.

Also read: Integration among South Asian nations key for food and energy security