Indian Energy Exchanges overall trade volume rises 14% to 9,044 million units in April
The Indian Energy Exchange (IEX) posted 14.1 per cent growth in its overall trade volume at 9,044 million units in April as compared to the year-ago period. The exchange achieved 7,928 MU overall trade volume in April 2023, including green market trade of 280 MU, 1,99,000 RECs (renewable energy certificates equivalent to 199 MU) and 1,23,000 ESCerts (energy savings certificates equivalent to 123 MU), as per IEX data. RECs at 618 MU increased 211 per cent YoY (year-on-year). At Rs 204 per certificate, the REC market recorded an all-time low price in the trading session held on April 24, 2024, a statement said. REC prices declined 80 per cent YoY. These prices provide an opportunity to obligated consumers to meet their Renewable Purchase Obligations, and voluntary customers to meet their sustainability aspirations. The Market Clearing Price in Day Ahead Market (DAM) during April 2024 at Rs 5.1/unit reduced approximately 6 per cent year-on-year. The sell bids on the exchange (Day Ahead Market plus Real Time Market) during the month increased 21 per cent YoY. The DAM prices were lower by almost 45 per cent as compared to prices discovered under bilateral contracts. Favourable policy and regulatory interventions by the government and regulators led to an improved sell scenario, leading to increased sell liquidity at IEX, despite an increase in the country’s energy demand, it stated.
Aramco Leads Oil Industry Investment in AI
Saudi Aramco is the biggest investor in artificial intelligence in the oil industry. The fact was recently revealed in a report by GlobalData, which also showed the Saudi state major was investing heavily in all sorts of cutting-edge technology. Because this is where competition will be in the future. Saudi Aramco spent $3.5 billion on research and development last year, GlobalData said in its report, noting the company was active in as many as 250 areas of innovation including, besides AI, drone technology, robotics, and electric vehicles. As for AI itself, the technology was deployed in areas such as oil exploration, fault monitoring, and cyber threat detection. On the one hand, this adds to evidence about the versatility of artificial intelligence that is driving its growing popularity in the information technology sector and elsewhere. On the other, the information suggests Aramco is actively working on attaining a new sort of competitive edge: a tech-driven one. The Saudi company is not alone in this, of course. Oil and gas, while traditionally slow to adopt emerging technology, has moved quite fast recently. Bloomberg reported earlier this year that U.S. shale drillers were deploying artificial intelligence to improve drilling efficiency and increase well recovery rates. The U.S. shale patch is a natural early adopter of such technology because production costs there tend to be generally higher than they are in conventional oil and gas drilling, motivating a higher appetite for new solutions. Now, thanks to tech, these costs are coming down as drilling times accelerate—and accuracy is improving too. Aramco, on the other hand, is as traditional as oil companies come, at least on the face of it. Below this face, the company appears to be—if not an early, then an eager—adopter of cutting-edge tech to improve its operations, even in lean years like 2023. It also seems Aramco is open to more adventures in tech. GlobalData reports that Aramco has set up a digital innovation ecosystem dubbed SAIL, or Saudi Accelerated Innovation Laboratory, to partner with other entities, including government agencies and startups, “to foster the development of digital innovation products,” per the report. “Aramco is also betting on futuristic technologies. The company is closely monitoring the startup ecosystem and has in the recent past invested in several companies such as Pragmatic, which develops flexible semiconductor chips, and Sunrate, a fintech company,” said Sourabh Nyalkalkar, practice head of innovation at GlobalData. It sounds like Aramco specifically and Saudi Arabia generally are trying to do what the UAE did with construction as a diversification strategy to reduce its almost exclusive income reliance on crude oil. That artificial intelligence, robots, and the rest of the new tech coming out of startups and Big Tech field, can be used to boost oil production as well must be a very welcome bonus. According to Evercore ISI, AI and other tech could bring costs in the shale patch down by double digits as soon as this year. “There’ll be significant cost savings, at a minimum double digits, but probably in the 25% to 50% of cost savings in certain scenarios,” Evercore analyst James West told Bloomberg in March. If it can bring costs down for shale drillers, AI could certainly bring them down for everyone else as well, even for the lowest-cost producers in the world – the Saudis. But cost reduction is only one of what seems like a lot of benefits that the oil industry stands to gain from using the technology such as more productive wells, more accurate exploration, and better threat detection, including not just cybersecurity but spills and leaks. Best of all, the industry has the commodities needed to power the use of electricity-thirsty AI.
India’s crude oil imports from Russia jump 18% in April amid decline in total imports
India’s crude oil imports fell around 8 percent in April from the previous month amid the country’s efforts to ramp up domestic production and reduce reliance on imports. According to energy tracker Vortexa, India’s total crude oil imports stood at 4.5 million barrels per day (bpd) in April, lower than 4.9 million bpd in March. Despite decline in total oil imports, Russia’s supply of crude oil to India increased by 18 percent in April from last month. Moscow supplied 1.7 million barrels of crude oil to India in April, as against 1.5 million bpd in March. Russian Urals—sour grade—was India’s major import from Moscow. The rise in oil supply from the Eurasian country comes despite reports of narrowing discounts on Russian oil and tighter US sanctions on the country. Meanwhile, India’s import of crude oil from other countries including Iraq, Saudi Arabia, UAE and the US fell in the month. Iraq supplied 776,000 bpd of crude oil to India in April, lower than 1.11 million in March while India purchased 681,000 bpd and 103,000 bpd of oil in the month from Saudi Arabia and the US, respectively. Imports from Venezuela also declined to 66,000 bpd in April compared to 161,000 bpd in the previous month. India started buying crude oil from Venezuela in late 2023 after a gap of three years. India last imported Venezuelan oil in 2020 after which the country came under sanctions from the US
Reliance Industries Ltd starts trading US oil setting Brent oil benchmark
Reliance Industries Ltd (RIL) has made its first foray into trading a type of U.S. crude oil that underpins the global Brent benchmark in a process run by oil-index publisher S&P Global Commodity Insights, the publisher said. RIL, operator of the world’s biggest refining complex, on Wednesday offered a cargo of WTI Midland in the Platts Market on Close process, known as the Platts window. It was Reliance’s first time offering WTI in the window, Platts spokesperson Kathleen Tanzy told Reuters. A Reliance spokesperson did not immediately respond to a Reuters request for comment. India, the world’s third-biggest oil importer and consumer, is looking to diversify its oil supplies as fresh U.S. sanctions on Moscow threaten to dent Russian oil sales to India, the biggest buyer of Russian seaborne crude. India was the top buyer of Russian oil last year after other groups retreated from purchases following Western sanctions on Moscow for its full-scale invasion of Ukraine in February 2022. RIL made its first oil purchase from Canada’s new Trans Mountain pipeline last month, trade sources said. More players have become involved in trading crude that can set the Brent price in the Platts window since Platts added WTI to the benchmark last year. Saudi Aramco, the world’s largest oil firm, made its first purchases of WTI in the window in February and has participated regularly since. U.S. WTI Midland is one of six crude oil grades assessed by Platts that can set the value of dated Brent, part of the wider Brent complex used to price more than three-quarters of the world’s traded oil. The price of dated Brent is set by the cheapest of the six crudes and Midland, by far the largest of the six crude streams, often plays a role in setting its value. The other five are North Sea crudes.