New Delhi: India has so far weathered the West Asia crisis, but Petroleum and Natural Gas Minister Hardeep Singh Puri cautioned on Thursday against taking that for granted. A deeper conflict could strain the country's defences, he said, and rising tensions between the US and Iran could make matters worse. "The crisis is certainly not over. It is not only ongoing but it has potential of exacerbating," Puri said at the 13th Annual Forum of the Public Affairs Forum of India (PAFI).
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He credited India with getting through the disruption so far and keeping the worst of its effects at bay. Any further escalation, however, could bring a new set of problems.
The world is not short of oil, Puri said. He put global supply at 102 million barrels per day and demand at 94–95 million barrels per day. His concern lies with the routes that carry it. If critical chokepoints such as the Strait of Hormuz and Bab-el-Mandeb were shut, supply could still run into trouble.
Refining capacity is what kept fuel flowing at home during the worst of the war, the minister said. India can refine 267 million tonnes per annum today, and that is expected to reach 320 million tonnes per annum by 2030.
Puri also responded to consumer concerns about ethanol-blended petrol. The government has no plans to raise the blend above 20 percent, he said.
The coming refineries have drawn interest from Saudi Arabia and the United Arab Emirates (UAE), Puri said. Both would invest if the projects offer meaningful returns. For any prospective investor, he said, a share of India's expanding downstream market would weigh heavily.
"Nobody wants to come and invest in a refinery unless they can also get a slice of your growing downstream market," Puri said.
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India is still exporting refined petroleum products, he said, and plans to honour its contractual export commitments. That is despite export bans imposed by other countries, including Russia and China.
