INFO ON DEMAND AND IMPORT OF OIL
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Union Minister of Petroleum & Natural Gas informed Lok Sabha today about the Demand and Import of Oil.
- Information given by: The information about demand and Import of Oil was given by the Union Minister of Petroleum & Natural Gas Shri Dharmendra Pradhan in the Lok Sabha today in a written reply.
- Oil consumption: The consumption of petroleum products in the year 2018-19 was 213.2 MMT.
- Oil dependency: The percentage of Import Dependency on Oil based on consumption of petroleum products during the 2018-19 was about 83.8%.
- Petroleum Reserves: With a total capacity of 5.33 Million Metric Tonnes (MMT), Indian Strategic Petroleum Reserve Limited (ISPRL) have established Strategic Petroleum Reserves (SPR) at three locations – Vishakhapatnam, Mangaluru and Padur. Total capacity storage of petroleum products is 74 days.
- Current stock: Oil Marketing Companies (OMCs) currently have stock for 64.5 days.
- Additional Reserves: The Government has given its approval for establishing two more additional reserves with a total capacity of 6.5 MMT. The location was – Chandikhol in Odisha (4 MMT) and Padur in Karnataka (2.5 MMT).
Oil war leads in crash in Price of oil:
- Initiative by: The Oil war was initiated by the Saudi Arabia after it failed to convince the Organisation of Petroleum Exporting Countries (OPEC) allies and Russia to make a substantial cut in oil production.
- Intention behind: Raising the production of crude oil and cutting prices at the same time was a tactical move by Riyadh to regain its dominant position in the oil market.
- The ongoing oil war between Saudi Arabia and Russia, leads the crude oil price fell by over 31%, registering its single largest fall since the 1990 Gulf War.
- This crash in oil price will help India in increasing its imports over 84% of its oil demand and satisfy our energy needs.
- Import bill: By the end of fiscal 2019-20 (March 31), India is likely to pay $105.58 billion on import of 225 million tonnes of crude oil – this is less than the previous year’s bill $111.9 billion for 226.5 million tonnes of oil.
- If such price remains low, India’s Current Account Deficit (CAD) may come down and it may increase our country’s economy – for each drop of a dollar in crude prices, India’s import bill comes down by nearly Rs 3,000 crore.
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