India likely to boost purchases of US oil, gas following Trump’s announcement
India may purchase more American energy as US President Donald Trump’s pro-oil and gas policies will increase US supplies to the global market, weighing on prices, Oil Minister Hardeep Singh Puri said on Tuesday “If you were to ask me whether more American energy is going to come on to the market, my answer is yes,” Puri said on the sidelines of SIAM’s International Symposium for Thriving Eco- Energy in Mobility. “If you say there is a potent possibility of more purchase of energy between India and the US, the answer is Yes.” The US is already a large supplier of oil and gas to India. Trump wants to leverage American oil and gas resources to spur manufacturing in the US. “We have something that no other manufacturing nation will ever have: the largest amount of oil and gas of any country on Earth. And we are going to use it,” Trump said at his inauguration ceremony on Monday. “We will bring prices down, fill our strategic reserves up again, right to the top, and export American energy all over the world.”
Refiners ask Abu Dhabi NOC to offer ‘oil delivered price’ as freight spikes
Indian state refiners have asked Abu Dhabi National Oil Co (ADNOC) to offer pricing of its crude on a delivered basis to manage costs, three refining sources said, after fresh US sanctions disrupted supplies and caused freight rates to spike. Refiners in India, which imports over 80 per cent of its oil, have been hit hard by a spike in global oil prices and shipping rates after Washington recently imposed sweeping new sanctions targeting Russian insurers, tankers and oil producers. The world’s No. 3 oil importer and consumer became the top buyer of discounted Russian seaborne oil after the European Union shunned purchases and imposed sanctions on Moscow following its invasion of Ukraine in 2022. Russian oil accounted for more than a third of India’s imports last year, but US sanctions are tightening supply, pushing the buyer back to traditional Middle East sources. While most Middle East crude producers sell oil on a free-on-board (FOB) basis via long-term contracts to Asian buyers, Russian oil traders have been supplying crude to India on a delivered at port (DAP) basis that includes insurance, shipping and other services borne by the seller. State-owned Indian refiners including Indian Oil Corp, Hindustan Petroleum Corp (HPCL) and Bharat Petroleum Corp have asked ADNOC for DAP price quotes, the sources said.
OMCs to register strong Q3FY25 on healthy marketing margins
The country’s oil marketing companies are expected to register strong earnings in the third quarter of the fiscal year on the back of healthy retail margins on diesel and gasoline led by a decline in crude oil prices, as per analysts. Elara Capital expects OMC’s retail margin on diesel to increase to Rs 9.3 per liter against Rs 0.4 per liter last year and Rs 5.8 per liter in the previous quarter. The retail gasoline margin may jump to Rs 12.8/liter against Rs 7.8/litre in the same period last year and Rs 9.4/liter in the previous quarter “We expect gross refining margins for PSU (public sector undertakings) refiners – Bharat Petroleum, Chennai Petroleum, Hindustan Petroleum, Indian Oil, and MRPL – to average at $5.1 per barrel in Q3FY25E from $1.6 per barrel in Q2FY25 and $9.3 per barrel in Q3FY24,” the brokerage said. It also expects the average crude inventory gain in the third quarter to be $0.3 per barrel against the loss of $2.7/bbl in the previous quarter. “We expect EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) for oil & gas companies to grow 7% on year and 31% sequentially in Q3FY25E, led by strong retail diesel and gasoline margin for OMCs, though partly offset by LPG losses and weaker gross refining margins from last year,” Elara Capital said in its preview. For the public upstream sector, analysts expect crude oil realizations to remain stable from last year at $72.6 per barrel, but down 2% from the previous quarter. Elara Capital sees Oil India’s crude production to grow by a marginal 1% from last year, while gas production is set to be flat due to a delay of a few quarters in Indradhanush Gas Grid gas pipeline connection and constraint in demand from the North-East (until the expansion of Numaligarh refinery by Q3FY26).
GAIL, BPCL to set up plants to produce compressed biogas in Chhattisgarh
The Chhattisgarh Biofuel Development Authority (CBDA) has inked an agreement with GAIL (India) and Bharat Petroleum Corporation (BPCL) for producing compressed biogas (CBG) from urban solid waste of six municipal corporations across the state. tripartite agreement was signed by the CBDA, GAIL, and BPCL for setting up CBG plants in municipal corporations of Ambikapur, Raigarh, Korba, Bilaspur, Rajnandgaon, and Dhamtari While GAIL will set up plants in Ambikapur, Raigarh, and Korba, BPCL will execute the agreement in Bilaspur, Dhamtari, officials said Through the deal, about 350 metric tonnes (Mt) of solid waste per day and nearly 500 Mt of surplus biomass from the six municipal corporations will be used for biofuel production. GAIL and BPCL will invest about Rs 6 billion. Similarly, the state will receive a goods and services tax of about Rs 60 million per year.