On May 22, 2017, Dharmendra Pradhan – Minister of State (Independent Charge) for Petroleum and Natural Gas, co-chaired the 2 nd India-OPEC Institutional Dialogue at the OPEC headquarters in Vienna, Austria.
- Mr. Pradhan held a one-to- one meeting with Mr Mohammad Sanusi Barkindo – Secretary General of OPEC.
- Bilateral issues of mutual interest were also discussed at a delegation level dialogue.
- Mr. Pradhan was accompanied by Secretary for Petroleum and Natural Gas, Indian Ambassador in Vienna and CEOs of India’s seven large refiners, both from public as well private sector – IOCL, HPCL, BPCL, MRPL, HMEL, Reliance and Essar.
- It is to be noted that OPEC Ministerial meeting is scheduled to be held from May 25, 2017.
- Dharmendra Pradhan emphasised upon following points at 2 nd India-OPEC Institutional Dialogue: Mr. Pradhan discussed the effects of the production cut of 1.8 mbpd by OPEC and non-OPEC countries on oil price volatility across the world.
- Highlighting that India had been and continued to be a reliable customer of OPEC countries, Mr. Pradhan stated that about 86% of India’s import of crude oil, 70% of natural gas, 95% of LPG is procured from OPEC countries.
- He suggested intensifying bilateral dialogue with an aim to change the nature of engagement from a buyer-seller relationship to an Energy Partnership.
- Mr. Pradhan was of the view that producers should understand the perspective of consumers and should be willing to accommodate the changes at the demand centres.
- He emphasised that OPEC should work towards “Responsible Pricing” which is important for India as it will foster socio-economic development in the country.
- It was agreed that India will host the next India – OPEC Institutional Dialogue in 2018.
OPEC – Asia Crude Oil Supply Dynamics: ‘Asian Dividend Vs. Asian Premium’:
- Mr. Pradhan insisted that as a large import destination, India and Asian buyers should not be subjected to ‘Asian Premium’ on the crude supplied.
- He referred to OPEC’s policy of subsidising western buyers at the cost of Asian buyers.
- He mentioned that as India makes timely payments and honors all its contractual commitments, OPEC should reciprocate by providing discount in prices for large volumes that India imports.
- Mr. Pradhan emphasised upon ‘Asian Dividend’ rather than ‘Asian Premium’ in context of India’s growing oil demand and its continuous support to OPEC.
Quick Facts about Organization of the Petroleum Exporting Countries (OPEC):
- Formation Year: 1960
- Headquarters: Vienna, Australia
- Number of Members: 13 Countries
- Current Secretary General: Mohammad Sanusi Barkindo