India at Centre Stage of Global Energy Affairs: IEA

Singapore: India, as a leading global energy consumer, is moving to the centre stage of international energy affairs rapidly but faces challenges of higher oil prices, a top official of the IEA said here on Tuesday.

High prices have hurt importers, including India where fiscal deficit has doubled, Fatih Birol, International Energy Agency executive director, said at the Singapore International Energy Week, as he welcomed the recent drop in international crude prices by about USD 10 per barrel.

“India is moving into the centre stage of global energy affairs rapidly, especially with the current government’s right energy policies,” he said.

“In India we have seen the fiscal deficit doubled, and measured in rupees, which is a serious issue for the Indian consumers, diesel prices reached level of USD 147 per barrel when oil prices were high at USD 85 per barrel,” said Birol.

But now the Indian government made the right move at the right time and provided relief to Indian consumers, he said of recent price adjustments in India, adding that at the same time the recent drop in prices was also helpful.

“As I have always said high oil prices are not good for oil importing countries like India,” he said.

He also expressed concern about declining exports from Iran and Venezuela but hoped that producers led by Saudi Arabia and Russia would put in more oil in the international markets.

Oil production in Iraq is also increasing despite the political challenges there, he added.

“It is true that India is getting considerable amount of oil from Iran and we will see how India and other importing countries from Iran behave in the next month to come,” said Birol, who expressed concern about declining oil production amid strong demand growth in November.

Birol sees increasing supplies from the US shale producers as the pipelines are completed in the coming months.

In 2019, oil markets will be more and more volatile, he said.

“There is completely a new and major factor coming in the picture. It is US shale which is very price elastic and we will see substantial amount of oil from the United States continue to flow into the markets,” he said.

Source:PTI

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