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Petrol and diesel prices have shot up to record highs across the country after relentless price increases since early May.
”If energy prices remain high, global economic recovery will be undermined,” Oil Minister Hardeep Singh Puri said at the India Energy Forum by CERAWeek.
International oil prices had crashed to USD 19 per barrel in April last year as demand evaporated with most nations clamping lockdowns to control the spread of coronavirus. The demand recovered this year as vaccination against the infection revived economies world over.
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This, he said, has made fuel expensive and stoking fears of inflation.
Puri said India’s oil import bill has climbed from USD 8.8 billion in June 2020 quarter to USD 24 billion this year because of a spike in global oil prices.
”India believes energy access has to be reliable, affordable and sustainable,” he said adding economic recovery after a devastating pandemic has been fragile and it is further being threatened by high prices.
India, which imports almost two-thirds of its oil needs from West Asia, has told crude oil producers, including the Organisation of Petroleum Exporting Countries (OPEC), that high oil prices will hasten the transition to alternate fuels and such rates will be counter-productive for the producers.
Puri has in recent weeks flagged the issue of high oil prices to Saudi Arabia, the UAE, Kuwait, Qatar, the US, Russia and Bahrain.
He conveyed India’s strong preference on responsible and reasonable pricing, which is mutually beneficial for consumers and producers.
Puri said volatility in international prices is not just hurting India but also industrialised nations.
While the world has begun the transition towards cleaner fuels such as electric-powered vehicles and hydrogen, most nations are still dependent on oil to fuel their economies. And high oil prices will hurt demand recovery.
India is 85 per cent dependent on imports to meet its oil needs and relies on overseas shipments to meet 55 per cent of the gas needs.
It is the only nation in the world that is seeing growth in oil demand on a sustained basis and without it the producers will also suffer.