Indian oil minister says high oil, gas prices can hit economic revival

High oil and gas prices can hamper the nascent economic revival that is taking place in developing countries like India, the country’s petroleum and natural gas minister Hardeep Singh Puri told the India Energy Forum by Ceraweek on October 20.

“If prices do not remain predictable, stable and affordable then economic activity could prove to be fragile,” Puri said. “India believes that access to energy must be affordable and predictable. That is when socio-economic transformation can take place.”

Petrol and diesel prices in India have hit a record high in recent days owing to a sharp spike in global crude oil rates. Petrol prices have breached the 100 rupees ($1.34)/litre mark in all major cities across India for the first time ever. The fuel is retailing at over 106 rupees/litre in Delhi after the fresh hike, while it has crossed 112 rupees/litre in Mumbai. It costs nearly 107 rupees/litre in Kolkata and above 103 rupees/litre in Chennai. 

On the topic of natural gas, the minister said that India is moving towards becoming a gas-based economy and about $60bn worth of investment is underway in the sector. He said India is expanding the gas pipeline grid, building more LNG import terminals and developing new city gas networks.

Pipeline projects being undertaken in east and northeast India will facilitate the development of one national, one grid, he said. City gas network is being developed to provide cleaner cooking fuel and the government is encouraging use of LNG in long-haul trucks, Puri added.

In order to tackle air pollution, India is aiming to boost the use of gas and raise its share in the energy mix to 15% by 2030 from about 6% now.