India is looking at raising oil imports from Russia, its oil minister said on Tuesday, at a time of surging oil prices after an attack on Saudi Arabian facilities halved the kingdom’s production.
Russia is jostling to capture market share in fast-growing India against rivals Saudi Arabia, Qatar and United Arab Emirates.
Dharmendra Pradhan said he had met the chief executive of oil producer Rosneft and that four Indian companies planned to increase their investment in Russian oilfields.
“Today I met excellency Igor Sechin, CEO of Rosneft. We elaborately discussed the possibility of oil imports,” Pradhan told reporters.
In the wake of weekend attacks that have hampered Saudi Arabia’s oil output, the oil minister also attempted to calm nerves on supply, saying he was confident that India, the world’s third-largest oil consumer, had a diverse crude basket.
Rosneft, the world’s largest listed oil producer by output, confirmed that a possible increase of oil supplies to Indian refineries had been discussed.
Rosneft and the government also discussed the development of Nayara Energy, a company in which Rosneft holds a majority stake.
The consortium is reviewing an option of a two-fold increase in refining throughput at the Vadinar Refinery, Rosneft said.
In the first stage, the consortium has committed to invest $850 million towards the building of a petrochemical unit within two years.
“The consortium is also planning to expand Nayara Energy’s retail presence, which is currently the fastest growing pan-India fuel retail network with over 5,300 retail outlets,” Rosneft said in a statement.
It also said joint projects – specifically Sakhalin-1 (oil and gas project), Taas-Yuryakh and Vankor (oilfields in Russia) – were being reviewed, but did not elaborate.
Saudi Arabia is the world’s biggest oil exporter, and the second-largest supplier of crude to India after Iraq. India reduced the Middle East’s share in its total oil imports to about 56% in July from around 60% a year ago, while increasing its share of imports from Africa and the United States.
Two sources briefed on state oil company Saudi Aramco’s operations told Reuters it might take months for oil production to return to normal. Earlier estimates had suggested it could take weeks.
“This incident is huge,” India’s Pradhan said in his first news conference following the attacks.
“But yesterday we lifted oil, and today also we lifted oil,” he said.