Rising international crude prices left little room to manoeuvre while private players are skittish about India’s oil and gas exploration sector
(Photo: Getty Images)
It has been less than a year since former bureaucrat Hardeep Singh Puri got additional charge of the crucial petroleum ministry, and it has not been an easy time. With the government’s thrust on Aatmanirbhar Bharat, Puri had to keep the ministry’s focus sharply on reducing the country’s dependence on imported crude oil by augmenting domestic production. India imports nearly 84 per cent of its crude oil requirement—212.2 million tonnes in 2021-22—spending Rs 9.28 lakh crore in the process, twice the amount it spent in 2020-21.
COVER STORY | The challenges ahead
Attracting private investments in the exploration and production of oil and gas remains a challenge. Round 6 of the Open Acreage Licensing Policy (OALP) bid last year attracted only three bids. Eighteen of the 21 blocks went to the public sector ONGC, Oil India Ltd got two, and Sun Petrochemicals one. Round VII of the bids is now under way. The petroleum ministry has been in focus throughout the past several months as fuel prices skyrocketed, first over the Covid-induced global scarcity and then the war in Ukraine. High fuel prices stoked inflation, prompting the Centre to cut excise duty on May 22. This means a revenue loss of Rs 1 lakh crore, but it may cut inflation by 30-40 basis points.
