India and LNG supplier Qatar set up task force to identify projects for investment
India and its biggest LNG supplier Qatar on Friday agreed to set up a task force to identify projects in India for investment by the gas-rich Gulf nation, Oil Minister Dharmendra Pradhan said. India imports 8.5 million tonnes per annum of gas in its liquid form (LNG) from Qatar under a long-term contract. It also buys LPG to meet the fast-expanding cooking gas requirements in the country. “Had a telecall with HE Saad Sherida Al-Kaabi, Qatar’s Minister of State for Energy Affairs and President & CEO Qatar Petroleum on promoting Qatari investments in the entire energy value chain in India,” Pradhan tweeted. The call, he said, was a follow-up to Prime Minister Narendra Modi’s discussion with the Emir of Qatar, Sheikh Tamin bin Hamad Al-Thani on December 8. “Minister Al-Kaabi and I have agreed to set up a Task Force on Energy, represented by VP of Qatar Petroleum and a senior officer from @PetroleumMin to identify specific projects in India’s energy sector for Qatari investments,” he said. Qatar Petroleum, the national oil company of the Gulf nation, will be represented by the vice president (VP) in the task force, while the Indian side would be represented by a senior official from the Ministry of Petroleum and Natural Gas. “I reiterated Qatar’s role as a reliable supplier of LNG and LPG. We also agreed to further strengthen cooperation in the energy sector and move beyond the buyer-seller relationship to a comprehensive one, including two-way investments,” Pradhan said. During the December 8 call between Modi and the Emir of Qatar, the two nations had agreed to create a special task force to explore and facilitate Qatari investments in India, including in the energy sector. Cash-rich Qatar Investment Authority is looking to invest in India, particularly in the energy and infrastructure sector. India is the world’s third-largest oil and LNG importer. At the beginning of this year, India asked Qatar for renegotiation of its long-term supply contract, but the Gulf state was not inclined to renegotiate the prices. India wants to significantly boost its gas consumption and expand its gas infrastructure. An investment of USD 66 billion is lined up in developing gas infrastructure which includes pipelines, city gas distribution and LNG re-gasification terminals, Pradhan had said earlier this month. Qatar, for its part, sees LNG as an important part of India’s plans to increase its gas-based economy. India is targeting to raise the share of natural gas in its energy basket to 15 per cent by 2030 from the current 6.3 per cent. During Prime Minister Modi’s visit to Doha in June 2016, India had sought Qatari investment in India’s oil and gas exploration and production as well as its participation in the building of the second phase of strategic oil reserves.
Asian LNG prices rise to over two-year high driven by heating demand
Asian spot prices for liquefied natural gas (LNG) rose this week to the highest since Sept. 2018 due to high demand for heating, a supply crunch and increasing freight rates, trade sources said. The average LNG price for January delivery into northeast Asia was estimated at around $11.10 per million British thermal units (mmBtu), up $3.00 from the previous week, the sources said. Prices for February delivery were estimated at around $10.50 per mmBtu. Temperatures in Beijing, Tokyo and Seoul are expected to be lower than average over the next two weeks, weather data from Refinitiv Eikon showed, increasing gas demand for heating. The rise in imports in China, as the economy recovers, and the lack of shipping availability is also helping to push prices up, the sources said. “LNG imports by China hit a one-year high in November and are set to increase further, raising demand” a London-based trader said. PetroChina and China National Offshore Oil Corp (CNOOC) said on Friday they will invite global bids for LNG in Shanghai. A recent tender by Pakistan LNG to buy six spot cargoes for January only garnered interest for half of the requirements, showing how tight the supply situation is, sources said. Production issues in Australia and Malaysia, two of the top four largest exporters, and delays in the Panama Canal, through which U.S. ships part of its liquefied gas, are adding to tighter supply. Prices are expected to stabilize in the second half of January with record volumes coming from the U.S, where natural gas prices are below $3, making exports profitable, traders said. LNG prices in Asia have increased by more than a five-fold since June, when lower demand due to the coronavirus pandemic drove them below $2.00/mmBtu.
India’s fuel demand fell 5 per cent in November: Oil ministry data
India’s fuel demand fell 5 per cent in November compared with the same month last year. Consumption of fuel, a proxy for oil demand, totalled 17.83 million tonnes, data from the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry showed. Sales of gasoline, or petrol, were 5.2 percent higher from a year earlier at 2.67 million tonnes. Cooking gas or liquefied petroleum gas (LPG) sales increased 3.5 percent to 2.35 million tonnes, while naphtha sales surged 7.3 percent to 1.35 million tonnes. Sales of bitumen, used for making roads, were 25.1 per cent up, while fuel oil use edged up 4.4 per cent in November.
Oil Marketing Companies continue to hold petrol, diesel price rise
Oil marketing companies continued to hold back any change in the retail price of petrol and diesel continuing with their wait and watch stance that has kept the prices of the two auto fuels static for the past seven days. Accordingly, there was no change in the retail price of auto fuels on Monday with the price of petrol remaining at Rs 83.71 a litre and diesel Rs 73.87 a litre in Delhi. Across the country as well the price of the two petroleum products remained unchanged. OMCs have gone on a pause mode at a time when the news of successful coronavirus and expectations of big pick up in demand had kept crude on the boil with prices breaching $ 50 a barrel mark. Crude, however, has remained static for the past few days reducing any pressure on upward revision in the fuel prices. Petrol price was very close to breaching the all time high level of Rs 84 a litre (reached on October 4, 2018) when it touched Rs 83.71 a litre on Monday. But the march has been halted ever since then with no price revision by the OMCs. Global crude prices have risen almost $ 10 a barrel in the last one month to reaching over $ 50 a barrel now. But even at this level, it is far less than than average crude price of $ 80.08 a barrel in October 2018 when petrol prices reached highs of Rs 84 a litre in the national capital. With Monday’s pause, fuel prices have now increased on 15 of the past 25 days with petrol prices rising by Rs 2.65 per litre and diesel by 3.41 a litre. Petrol price had been static since September 22, and diesel rates hadn’t changed since October 2. Though the retail pricing of petrol and diesel has been deregulated and oil marketing companies were following a daily price revision formula, the same was suspended for almost two months to prevent volatility in international oil markets from impacting fuel prices regularly during the pandemic.