Petroleum Minister of India appeals to the Oil producing countries to ease production cuts to stabilise the fragile global economic recovery

New Delhi: Shri Dharmendra Pradhan, Minister of Petroleum and Natural Gas &Steel, participated in the 11th IEA-IEF-OPEC Symposium on Energy Outlooks —held virtually— on 17th February 2021 under the patronage of the Minister of Energy of Saudi Arabia HRH Prince Abdulaziz bin Salman Al Saud.

The symposium saw the presence of heads of all top inter-governmental energy agencies -IEF, IEA, OPEC, IRENA and the GECF. Also, dignitaries like, H.E. Norma RocíoNahle García, Secretary of Energy, Mexico and H.E. Timipre Sylva, Minister of State of Petroleum Resources of Nigeria participated in the event.

Apart from the comparative analysis of short, medium, and long-term energy outlooks that OPEC and the IEA published in 2020, the trilateral symposium reflected on the long-term outlooks of key producer and consumer countries.

In his address, Shri Pradhan highlighted that there was unanimous agreement among international agencies, like IEA, OPEC, vis-a-vis reports released by them on India’s robust energy growth profile during 2021 and beyond. While the world’s total primary energy demand would increase at less than 1% per annum till 2040, India’s energy demand would grow at about 3% per annum till 2040.

The recently-released IEA’s India Energy Outlook 2021 highlights that India has now emerged as the key centre for global energy demand, and is expected to become world’s largest energy consumer soon. Our share in global energy consumption is set to double in the next three decades.

OPEC and EIA in their near-term outlook estimate that global fuel consumption will grow by 5.6 to 6 million barrels per day in 2021, where more than half of this growth will come from India and China. Natural gas demand is also projected to increase three-fold by 2040.

Given this backdrop, where the world is limping back to normalcy, Minister Pradhan reiterated that there is a need to allow consumption-led recovery that has just taken roots in several emerging economies, including India. The rising oil prices during the last few weeks are hurting the fragile global economic recovery leading to significant demand contraction. The key producing countries have not only revised the production cuts over and above the previously announced levels, but also made additional voluntary cuts.

The Minister stated that India had supported the joint decision by major oil-producing countries to cut oil production in April last year amid a sharp fall in demand due to the Covid-19 pandemic. In the current scenario, however, he appealed to the oil-producing countries to have a rethink on continuing and increasing production cuts. He reiterated that in the collective interests of both producing and consuming countries, prices should be reasonable and responsible. The price-sensitive Indian consumers are getting adversely affected by rising petroleum product prices. It also affects demand growth, which could potentially impact the delicate aspirational economic growth trajectory not just in India but in other developing countries as well.He added that India remains dedicated and committed about evolving a sustainable energy future for all, and in this regard, will leverage all available energy resources.