From Russia to the US: Europe’s Shift in Energy Reliance Sparks Debate on Vulnerability
Ursula von der Leyen, the president of the European Commission, expressed her regret at the Davos Forum that energy prices in Europe are substantially higher than those in the United States and China. Von der Leyen’s conduct so far can be characterized as a rabid anti-Russian and pro-Ukrainian cheerleader. Although she turned the facts upside down on who stopped the Russian cheap energy, she insisted that given the EU’s steadfast policy of refusing to purchase hydrocarbons from Russia, it is necessary to diversify supplies and shift towards renewable energy sources. In the interim, Donald Trump, the newly elected president of the United States, is abandoning the globally cherished green agenda. He has directed an increase in gas and oil extraction in the United States and has suggested to Europe that only America can serve as its sole dependable source of natural energy resources. In a virtual address at the same Davos Forum, Trump announced that the United States is prepared to supply the European Union with large-scale energy supplies, including liquefied natural gas (LNG). The fundamental principle of this “deal” is straightforward: Europe grants the United States monopoly status in its energy market, and in exchange, Washington refrains from initiating a trade conflict with the economically disadvantaged European Union. At first, this appears to be absurd, as Trump appears to be providing Europeans with an option without a choice. Nevertheless, it would be extremely naive to underestimate the gravity of his threats and his capacity to implement them.
Bangladesh Govt signs LNG deal with US firm
The government has signed a heads of agreement (HOA) with the US-based Argent LNG to import up to 5 million tonnes of liquefied natural gas per year for 20 years. Argent LNG is developing a 25 million metric tonnes per annum LNG facility in Louisiana, a southeastern US state on the Gulf of Mexico. The facility is slated to go into operation in early 2030. The HOA is a non-binding agreement, meaning neither party is obligated to agree to the terms listed in the document.
GAIL Chairman Sandeep Kumar Gupta Predicts Continued High Oil and Gas Prices Amid Market
Expecting the second term of US President Donald Trump to be overall good for the energy sector, public sector major GAIL India’s chairman Sandeep Kumar Gupta has said that any softening in oil and gas prices may still take some time. Speaking during the World Economic Forum Annual Meeting, Gupta also said GAIL is looking to scale up its capital expenditure in the next 3-5 years to Rs 100-120 billion as work is underway on several gas pipelines and other projects. He also expected that the Union Budget would give relief on compression charges on CNG and some steps are taken to bring natural gas under the GST coverage. Asked about the impact of Trump’s second presidency, Gupta said: “President Trump is committed to more energy for the US. He has already declared an energy emergency whereby he wants more oil and gas to be explored so that there is energy efficiency in the US. While this bodes well for oil and gas sector with more availability of oil and gas which will definitely ease pressure on the prices but this will take time because presently all the Liquefied natural gas (LNG) export facilities were on pause by the Biden administration. So lifting those pauses and putting these projects will take time. So the softness in the prices will take some time. For the time being these higher prices will rule,” Gupta said. Talking about his company, Gupta said: “We are the largest natural gas pipeline of the country and we have already laid lion’s share of the existing natural gas pipeline of the country. In the current year also, we are completing many pipelines.” Gupta also exuded optimism about GAIL’s growth, as he talked about the company’s projects in the pipeline. “We are working on Kochi-Mangalore-Bangalore pipeline where the Tamil Nadu section was pending. Work on the Gurdaspur-Jammu pipeline is on. A lot of pipeline projects are underway. “We have presence in petrochemicals too. Our project at Usar is the country’s first Propane Dehydrogenation Polypropylene unit will hopefully get completed this year. We have acquired PTA facility from erstwhile JBF petrochemicals at Mangalore, which is a 1.25 million tonne PTA project,” Gupta said.
Muted natural gas output likely in FY25 on cautious Reliance Industries’ KG Basin fields outlook
India’s natural gasoutput is headed for a muted show in FY25 after three straight years of rise, as the production outlook is rather circumspect at Reliance Industries’ KG Basin fields that were at the vanguard of the industry’s growth in recent years. India produced 27.3 billion cubic meters in April-December 2024, compared with 27.2 billion cubic meters in the same period a year earlier. In the second and third quarters of the current fiscal year, output was lower than in the previous year. The growth over the past three fiscal years was primarily fuelled by Reliance Industries’ new fields in the KG basin, as output from state-run ONGC’s fields had been declining for several years. Domestic gas production had slumped 40% in nine years to 2020-21 but surged 19% year-on-year in 2021-22 after Reliance Industries brought to production some new fields in the KG D6 block. In 2022-23, domestic production rose 1% while in 2023-24, it increased 6%.
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.
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.” The US is the largest producer of oil and natural gas in the world. It is also the top exporter of liquefied natural gas (LNG) and its supplies helped Europe quickly replace much of Russian pipeline gas following the breakout of the Ukraine war in 2022. Trump wants US oil and gas production to further rise. “We will be a rich nation again. And it is that liquid gold under our feet that will help to do it.” Trump blamed energy prices for the cost-of-living crisis in recent years in the US. “The inflation crisis was caused by massive overspending and escalating energy prices. And that is why today I will also declare a national energy emergency. We will drill, baby, drill,” he said.
Indian students flock to petroleum and mining programs amid Trump’s second term buzz
As Donald Trump prepares for his second inauguration, a curious trend is emerging among Indian students aspiring to study abroad: a renewed focus on courses in extractive industries such as petroleum, mining and agriculture-related fields. Study abroad consultants report a surge in applications to programmes tied to sectors Trump has historically championed, likely due to expectations of regulatory leniency and job creation under his administration. “The United States is a top destination for Indian students pursuing courses like petroleum engineering, mining engineering and agricultural sciences,” said Piyush Kumar, regional director – South Asia, IDP Education. He notes that programmes offering STEM (science, technology, engineering and mathematics) designations are particularly popular as they provide students with up to 36 months of work experience through optional practical training (OPT). Courses in petroleum and mining, such as natural gas engineering, geotechnical engineering and mineral & energy economics, are seeing increased demand. On the agriculture side, programmes in animal sciences, livestock business management and agronomy are drawing attention. Universities in energy hubs like Texas and Colorado and agricultural powerhouses in the Midwest are the preferred choices for these aspirants.