It may not be possible to bring petrol, diesel under GST for time being: CBIC chief Sanjay Agarwal
As discussions continue to bring petrol and diesel within the ambit of Goods and Services Tax (GST), Chairman of the Central Board of Indirect Taxes and Customs (CBIC) Sanjay Kumar Agarwal said it may not be possible to bring these items under the indirect taxation for the time being. Asked if petrol and diesel should be brought under GST, Agarwal told IANS that petrol and diesel are presently subject to central excise duty and value-added tax (VAT), as these two petroleum items fetch a substantial revenue to the states by way of VAT and to the Central government by way of central excise duty. “So, looking to the revenue implications, it may not be possible to bring these items under the ambit of GST for the time being,” he added. The CBIC Chairman’s comment came as Finance Minister Nirmala Sitharaman said last week that the Central government intentionally did not include petrol and diesel in the GST Council proposal. “Legally, we are ready, but this decision must come from the states,” she said. According to her, petrol and diesel were set to figure, “even when GST was implemented, I remember my late predecessor Arun Jaitley talking about it”. “Once the states agree, they have to decide on the rate of taxation in the council. Once that decision is taken, it will be put into the act,” FM Sitharaman noted. In the GST implemented in July 2017, products like petrol, diesel, and alcoholic beverages were kept outside its ambit since then. These commodities are major revenue sources for both the Central and state governments through excise duty and VAT. For several states, these contribute over 25-30 per cent of their tax revenue. States fear losing control over taxation policy, pricing, and the ability to influence consumption patterns through excise duty and VAT.
Middle East Unrest Clouds Future of $35B Israel-Egypt Gas Deal
Over the past couple of years, Egypt has seen its ambitions to become a regional natural gas supply and LNG export hub go up in flames, with a series of setbacks turning the country from a net exporter of the vital commodity to an importer. Egypt’s natural gas production has declined rapidly over the years due to the natural depletion of mature fields, including the Zohr gas field. Coupled with a lack of significant new discoveries since 2015, surging domestic demand for electricity, and past financial issues such as hard currency shortages and payment arrears to foreign companies, Egypt now finds itself in a tenuous position, becoming a net gas importer since 2022, and relying on imported Liquefied Natural Gas (LNG) as well as pipeline gas from Israel. Last year, Egypt imported a record 981 million cubic feet per day of natural gas from Israel, good for 18.2% year-over-year increase. Egypt imports up to 20% of its gas from Israel. Last month, Egyptian Prime Minister Mostafa Madbouly announced that the $35-billion gas supply agreement signed with Israel’s NewMed Energy (OTCPK:DKDRF), a key partner in Israel’s giant Leviathan gas field, was extended until 2040. But the fate of these gas flows now hangs in the balance, with tensions in the Middle East escalating after the Israeli military ordered residents of Gaza City to evacuate. After spending more than a year constantly on the move, hundreds of thousands of people flooded back to Gaza City earlier in the year during the ceasefire. But now, Israel wants them to move out again. Last month, Netanyahu declared that he is “deeply committed to the vision of Greater Israel,’’ encompassing parts of Arab countries stretching from the Euphrates to the Nile. According to the Israel Hayom, Netanyahu has instructed officials “not to move forward with the massive gas deal with Egypt without his personal approval.” However, Egypt is now daring Israel to cancel the lucrative deal, saying that it [Egypt] has other options. “Netanyahu sees Egypt as an obstacle to his dream of Greater Israel and a danger to him, a thorn in his side, especially since Cairo is the first line of defense against Palestinian displacement,” Diaa Rashwan, head of Egypt’s State Information Service (SIS), said in televised statements. “The Egyptian administration has alternatives and scenarios for what may happen, and Netanyahu is trying to export a crisis to Egypt,” he added. But replacing Israel’s gas is likely to come at a big cost to Egypt. Under the latest deal signed in August, Israel will sell ~130 bcm of gas to Egypt through 2040, or until the contracted volume is fulfilled. The gas will be delivered via pipelines, making it considerably cheaper than LNG. According to commodity experts, LNG prices are currently averaging $13.5 per million British thermal units (mmBtu) excluding the cost of leasing floating storage (FSRUs), much higher than $7.75 for Israeli gas. On the other hand, Israel can use the impasse to negotiate higher prices for its gas, with Reuters reporting in May it intended to increase the prices of exported gas by 25%. Discovered in 2010, the Leviathan Gas Field is located approximately 130 km off the shores of Haifa. The 330-square kilometer field holds ~22.9 trillion cubic feet of recoverable gas, making it the largest natural gas reservoir in the Mediterranean, and one of the largest producing assets in the region. Production is facilitated by 4 subsea wells that are connected to an offshore platform via a subsea manifold and two 120 km long pipelines, where all processing of gas takes place. The gas is then piped to shore into the Israeli national grid and distributed to clients in Israel, Egypt, and Jordan. NewMed is Leviathan’s main operator with a 45.3% working interest; Chevron Corp. (NYSE:CVX) has a 39.7% working interest while Ratio Energies. (TASE: RATI) has 15%. Founded in 1992, Ratio Energy is one of Israel’s leading energy partnerships, with a mission to develop and produce natural gas and oil. With nearly 0.7 TCF produced by the end of 2021, the first phase of the field’s development has been a resounding success. Last year, the three companies announced plans to ramp up gas production and exports in 2025 in a bid to meet growing demand. Currently, a maximum capacity of up to 1.2 billion cubic feet of natural gas per day, or 12 billion cubic meters per year, can be piped from the Leviathan reservoir. Chevron and NewMed Energy have also partnered in the Aphrodite Gas Field, with Anglo-Dutch oil major Shell Plc (NYSE:SHEL) a third partner. Chevron and Shell each have a 35% working interest in the field, while NewMed has 30%. Discovered in 2011, the Aphrodite natural gas field is located about 170 kilometers south of Limassol in Cyprus, just 30 kilometers northwest of Israel’s Leviathan gas reservoir. An appraisal well has already been drilled to confirm assessments regarding the nature and size of the Aphrodite gas deposit, and marks a “significant step” towards its development. The well is expected to serve as a production well following the completion of the development of the reservoir.
Can there be more pain for India if the US, EU join hands?
As the Russia-Ukraine war continues into its fourth year, the United States and the European Union are preparing a new wave of economic measures aimed at tightening the financial noose around Russia. Central to this strategy is the deployment of secondary sanctions, targeting not just Russia directly, but also countries and entities that continue to do business with it, especially in the energy sector. These sanctions mark an escalation in the West’s economic warfare against Russia. But they also risk deepening global economic fractures, especially with strategic partners like India and China, and could expose the contradictions within the EU’s own policy landscape. Unlike primary sanctions, which ban a country’s own companies and citizens from engaging with sanctioned entities, secondary sanctions aim to punish third-party countries or businesses that facilitate or benefit from such engagements. The idea is to cut off Russian revenues even where Western influence doesn’t directly reach. These measures could include freezing assets, cutting off access to Western banking systems, banning reinsurance for oil tankers, and placing tariffs on countries that continue trading with Russia.
ONGC plant fire: CNG availability may be impacted in Mumbai, says MGL
Over 40 per cent of sedans sold in India now run on CNG as consumers increasingly prefer cleaner fuels, and also use their cars for business purposes, according to data collated by global data and analytics firm Jato Dynamics.The fire at ONGC’s Uran gas processing plant has impacted MGL’s gas supply to its city gate station at Wadala, while the supply to CNG stations may be affected. Mahanagar Gas Limited (MGL) is ensuring that the supply to its domestic PNG consumers is maintained as a priority without interruption. A fire broke out in the ONGC plant at Uran in neighbouring Navi Mumbai around 3 pm. It was doused by Oil and Natural Gas Corporation’s fire brigade service after around two hours, police said. Nobody was injured in the incident. MGL is ensuring that the supply to its domestic PNG consumers will be maintained on a priority without interruption, but CNG stations’ supply may be impacted. “A disturbance at ONGC’s Uran gas processing facility, prompting MGL to prioritise uninterrupted supply to domestic PNG consumers while cautioning that low pipeline pressure could impact CNG availability across Mumbai,” the MGL said in a statement on Monday night. The MGL also urged industrial and commercial customers to switch to alternative fuels. It said the full restoration of gas supplies is expected once ONGC resumes normal operations.
India’s natural gas production falls 3.7% in July; LNG imports down 20%
India’s natural gas production declined 3.7 per cent to 2,967 million standard cubic metres (MMSCM) in July 2025, while liquefied natural gas (LNG) imports contracted by 20.15 per cent year-on-year to 2,946 MMSCM, according to the Petroleum Planning and Analysis Cell (PPAC). Natural gas availability for sale during the month dropped 13.12 per cent to 5,430 MMSCM as compared to 6,250 MMSCM in July 2024. Total gas consumption in the month was reported at 5,875 MMSCM, the data showed. The fertilizer sector remained the largest consumer, accounting for 29 per cent of total consumption. It, however, saw a 3.5 per cent decline at 1,739 MMSCM. Consumption by the city gas distribution (CGD) segment increased 10.7 per cent to 1,396 MMSCM, while the power sector registered a 2.2 per cent rise to 745 MMSCM. Refineries consumed 428 MMSCM, down 17.2 per cent, whereas petrochemicals recorded a 9.2 per cent growth at 309 MMSCM.
Russia-China Gas Deal May Seal New Gas World Order
The signing of the Power of Siberia 2 pipeline deal by the presidents of Russia and China was perhaps the biggest news to come out of the two leaders’ meeting earlier this month. It was also the deal that may very well make the new global natural gas flow order permanent, potentially interfering with President Trump’s energy dominance ambitions. The Power of Siberia 2 project has been in the works for years. Yet China took its time deciding to commit to it. Now, the decision has been made, and although details have yet to be tailored, the signal is clear: China will be sourcing more natural gas from Russia—a lot more. The annual amount of gas Russia will be selling to China once the second Power of Siberia is completed would exceed 100 billion cu m. Incidentally, this is a similar amount to that which Russia was supposed to be sending to Europe after the completion of the second branch of the Nord Stream pipeline. This will not be happening now, not with the EU leaders pledging to suspend all imports of Russian energy within two years, even as they keep buying Russian gas from TurkStream and step up LNG imports from the most sanctioned country in the world. This will have to stop if the EU is serious about ending all Russian energy imports. As luck and geopolitics would have it, the EU has a ready and willing alternative supplier. U.S. gas producers have been on a roll, boosting production for the liquefaction plants along the Gulf Coast, eyeing the European market as a long-term demand source. The Trump administration has been encouraging this as part of its energy dominance agenda. For both, the Russia-China pipeline deal is a problem. It is, however, a bigger problem for the European Union. European businesses have a competition problem. It stems from high energy costs that drive up final prices for things produced in Europe. China, on the other hand, has lower energy costs that boost the competitiveness of Chinese-made products. There is also the innovation issue, but that’s a different topic. So, China enjoys low-cost energy to enhance the competitiveness of its products on international markets, while Europe struggles with the impact of high-cost energy on its competitiveness. Now, the struggle is about to become chronic. Europe is already the largest market for U.S. liquefied natural gas. This is good in terms of supply security but not so good in terms of price. As has been repeated ad nauseam, there is no way in the physical world we inhabit for U.S. LNG to become cheaper for European buyers than Russian—or indeed Norwegian—pipeline gas for obvious reasons related to geography and the production costs of gas liquefaction. This automatically puts LNG-dependent Europe at a disadvantage compared to China, an even greater one than it is already facing. The situation is somewhat problematic for the Trump administration as well, because the energy cost troubles of European businesses will eventually begin to affect their purchasing power—and the purchasing power of the governments responsible for securing energy supplies for, say, the heating season. This is not good for governments planning to dedicate billions in subsidies to specific industries and financial aid to households unable to afford current energy prices. Essentially, there is not enough money to cover all the expenses in Europe. From the U.S. perspective, the Power of Siberia 2 deal is also bad news because it means China would be importing less LNG, including U.S. LNG, as Reuters’ Ron Bousso pointed out in a recent column. Yet China has not imported U.S. LNG for months. It stopped importing U.S. LNG in early spring, amid the tariff spat between Washington and Beijing. Meanwhile, U.S. LNG exports hit an all-time high last month, suggesting producers don’t really need the Chinese market all that vitally. The future may, on the face of it, seem uncertain for both U.S. LNG producers and European buyers. The latter’s governments have insisted they want to reduce and eventually phase out the consumption of all hydrocarbons. This, however, would take decades, if it ever happens. The reality of energy has helped motivate the surge in new U.S. LNG capacity expected to come online over the next few years. However, there are limits to how much new export capacity can be built—because demand for gas is on the rise in the U.S. itself as well. With the boom in data center construction, domestic demand in the U.S. is rising for the first time in over a decade. As soon as this pushes prices high enough, more gas will be going into the domestic market, making LNG even more expensive for European buyers. Perhaps it’s time Europe’s leadership started looking into pipeline gas alternatives, from, say, Central Asia.
India Expands Crude Purchase From Nigeria
India Oil Corp has significantly sustained oil imports from Nigeria after skipping the purchase of U.S. oil in its latest tender. According to Reuters, which quoted trade sources on Friday, the company purchased 2 million barrels of Nigeria’s crude oil and a million barrels of Middle Eastern grade. The state refiner also bought one million barrels each of Nigerian oil grades Agbami and Usan from French oil major TotalEnergy, and another million barrels of Abu Dhabi’s Das crude from Shell, the people said. Nigerian oil has been bought on a free-on-board basis, and Das has been purchased and delivered to Indian ports in late October or early November. IOC bought 5 million barrels of U.S. West Texas Intermediate in its previous tender last week. In recent months, Indian refiners have advantage of a favourable arbitrage window and raised their purchase of U.S. oil via tender.
GST Cut On Biogas Plants To Spur Investment, Says Industry Body
Effective from 22 September, the GST on biogas plants and devices has been cut from 12 per cent to 5 per cent following a major restructuring of the tax regime. The GST Council, comprising the Centre and states, last week agreed to reduce tax rates on 375 items and simplify slabs from four to just two. From the effective date, most common-use goods will attract 5 per cent GST, while the rest will be taxed at 18 per cent. According to IBA, the tax cut will make biogas plants more affordable and financially attractive, directly improving project viability. The sector is expected to see a 4–5 per cent rise in new investments in the short to medium term, with the multiplier effect across the value chain likely to be even higher. By 2030, the Indian compressed biogas (CBG) industry could draw USD 4–5 billion in private investment, the association said. IBA president A R Shukla welcomed the reform, saying it would not only make biogas more accessible but also create jobs in manufacturing, installation and maintenance. However, he stressed the need to correct the inverted tax structure, where inputs for biogas equipment attract higher GST than the finished plant, inflating project costs. The move is expected to accelerate the adoption of decentralised renewable energy in rural areas, complementing other green technologies such as solar, wind and waste-to-energy systems, while reducing installation expenses and supporting India’s energy transition goals.
India will continue to buy Russian oil despite US tariffs, finance minister says
India will continue to buy Russian oil as it proves economical, its finance minister said on Friday, despite the Trump administration’s decision to impose heavy import tariffs on Indian goods due, in part, to its energy purchases from Moscow. As Europe and the US have shunned Russian oil over Moscow’s 2022 invasion of Ukraine, India has taken advantage of discounts on Russian output to become the largest buyer of Russian seaborne crude. New Delhi has said its purchases of Russian oil have kept the markets in balance. US President Donald Trump, who is seeking to broker an end to the Ukraine conflict, has said India’s oil imports are helping fund Moscow’s war effort and imposed a 50 per cent tariff on imports from India last month. Finance Minister Nirmala Sitharaman, speaking on local news channel CNN-News18, said India, the world’s third-biggest oil importer and consumer, had no plans to eschew Russian supplies. “We will have to take a call which (supply source) suits us the best. So we will undoubtedly be buying it,” she said, adding that India spends most of its foreign exchange on purchases of crude oil and refined fuels. US Commerce Secretary Howard Lutnick urged India on Friday to back the dollar, resume trade talks with Washington and stop buying Russian oil. “We’re always willing to talk. The Chinese sell to us. The Indians sell to us. They’re not going to be able to sell to each other. We are the consumer of the world,” Lutnick said in an interview with the “Bloomberg Surveillance” program. “Either support the dollar, support the United States of America, support your biggest client – who’s the American consumer – or, I guess you’re going to pay a 50% tariff. And let’s see how long this lasts.” He predicted India will come back in one or two months, apologize to Trump and seek a trade deal. In the fiscal year to March 2025, oil and refined fuels purchases from overseas accounted for about a quarter of India’s overall imports. “Whether it is Russian oil or anything else, it’s our decision to buy from the place which suits our needs whether in terms of rates, logistics, anything,” Sitharaman added. Indian Prime Minister Narendra Modi joined Russian President Vladimir Putin at a summit in Tianjin this week that Chinese President Xi Jinping hosted as a demonstration of solidarity against the West. Modi’s participation in the meetings, dubbed “the Axis of Upheaval” by some observers, alongside the leaders of countries like North Korea and Myanmar was viewed by some experts as a consequence of New Delhi’s falling out with Washington.
ADNOC signs LNG supply agreement with IndianOil
Dhabi National Oil Company (ADNOC) has entered into a 15-year agreement with Indian Oil Corporation (IOC) to supply one million tonnes per annum (MTPA) of liquefied natural gas (LNG) from its Ruwais project. The deal strengthens India’s energy security while supporting its rising energy demand. With this agreement, IOC will become ADNOC’s largest LNG customer by 2029, sourcing 2.2 MTPA — 1.2 MTPA from Das Island operations and 1 MTPA from Ruwais. The Ruwais LNG facility, currently under development in Al Ruwais Industrial City, will begin commercial operations in 2028. A lower-carbon LNG project The Ruwais facility will be the first in West Asia powered entirely by clean energy, placing it among the lowest carbon intensity LNG plants worldwide. Equipped with advanced technologies such as artificial intelligence, the plant will enhance efficiency, safety, and sustainability. Once operational, it will feature two liquefaction trains with a combined capacity of 9.6 MTPA. Strengthening India-UAE energy ties The agreement is another milestone under the Comprehensive Economic Partnership Agreement (CEPA) signed between India and the UAE in 2022, which has bolstered bilateral trade and energy cooperation. Rashid Khalfan Al Mazrouei, ADNOC’s Senior Vice President for Marketing, said the deal underscores the robust partnership between the two countries and will help meet global demand for lower-carbon gas while supporting industrial growth. Expanding LNG partnerships The Ruwais project, launched in November 2024, has already secured commitments for over 8 MTPA of its 9.6 MTPA capacity. Earlier this year, ADNOC signed a 10-year LNG supply deal with Hindustan Petroleum Corporation (0.5 MTPA) and another with GAIL (0.52 MTPA). These long-term agreements highlight India’s growing role as a key LNG importer.