BPCL seeks extra Iran oil amid sanctions threat
Indian state refiner Bharat Petroleum Corp. has requested an extra one million barrels of oil from the National Iranian Oil Co. (NIOC) for June, two industry sources said, amid a looming threat of stringent U.S. sanctions. The move by BPCL indicates that refiners will try to front-load their purchases from Iran ahead of a November U.S. deadline for re-imposing sanctions on the country’s petroleum sector. Uncertainties cloud Iran’s oil exports after U.S. President Donald Trump abandoned a 2015 nuclear agreement this month and ordered the re-imposition of U.S. sanctions on Tehran. Some sanctions take effect after a 90-day “wind-down” period ending on August 6, and the rest, notably on the petroleum sector, after a 180-day “wind-down period” ending on November 4. “At this point of time Iranian crude is attractive … it is faring better than spot cargoes and other crudes,” said one of the sources. Free shipping Iran has agreed to provide almost free shipping to Indian refiners in 2018/19, an incentive that significantly reduces the landed cost of Iranian oil compared to rival regional grades. “When the going is good, BPCL thought it should take it,” this source said. BPCL did not respond to Reuters’ request for comment. Top client India is Iran’s top oil client after China and was one of the few nations that continued to trade with Tehran during the previous round of Western sanctions as New Delhi follows only the restrictions imposed by United Nations. So far India’s oil imports and payment mechanism have not been hit by the threat of U.S. sanctions. India’s Reliance Industries Ltd., owner of the world’s biggest refining complex, plans to halt oil imports from Iran, two sources familiar with the matter said this week, in a sign that new U.S. sanctions are forcing buyers to shun oil purchases from Tehran. Reliance’s move is expected to take effect in October or November. Europe visit An Indian delegation with officials from the finance, petroleum and foreign ministries will visit European nations for a week from Monday to explore ways to continue to trade with Iran despite U.S. sanctions, a government official said. European states have been scrambling to save the 2015 nuclear deal and planning a package of economic relief to persuade Iran to stay in the deal. “Europe has taken a position, which is different this time. This time we are in the same boat,” this official said. The Indian delegation would visit France, Germany, Britain and Brussels to meet governments and bankers. Currently India settles oil payments in euros through Germany’s EIH Bank. “(It’s) not only oil imports, we (European nations and India) are also impacted by concomitant things like banking. We will discuss all these and the way forward,” the official added. Rashod Hill Jersey
Revenue earned during lean crude market utilised for developmental projects: Piyush Goyal
Revenue earned by the government during low crude prices in the International market has gone into the developmental projects of various nature and magnitude, Union Minister Piyush Goyal said today. Goyal was talking to media here ahead of flagging of Bandra — Jodhpur Hamsafar Express from Bhagat ki Kothi railway station. “The revenue earned by the government during the lean crude market by not reducing the prices accordingly, has been utilised in developmental projects, which were of very high importance,” the Minister for Railways, Coal and Corporate Affairs said. On spurt in fuel prices He, however, said the government was concerned about the spurt in fuel prices in the country and the inconvenience caused to the common man because of the price rise. “It is matter of concern for us and we are working desperately on the issue to bring a reduction in the prices of fuel in order to provide relief to the common man,” Goyal said. The minister said Prime Minister Narendra Modi assumed office amid a highly adverse financial condition both on national and international level, but due to efficient and determined handling of the situation by the government, situation has come on track. “As a result the GDP which was around 4.5% then, has touched a mark of 7.5% on account of revolutionary steps,” he said. On GST Referring to GST, Goyal said it was passed unanimously for a radical change in the economy and the result was that the tax collection under GST has touched new high. He also said that not only on the financial front but the government has equally worked with efficiency on social security front. Jerome Baker Womens Jersey
Russia’s Rosneft: Oil product export curbs may help domestic market – Interfax
Russia’s largest oil producer Rosneft said on Thursday that restrictions on oil product exports should be one of the measures the government should look at to help stabilise the domestic fuel market, Interfax news agency reported. Retail gasoline and diesel prices have skyrocketed on the domestic market in Russia following a recent strong global oil rally as well as an increase in fuel taxes. Gasoline prices broke through the psychologically important level of 40 roubles ($0.6429) per litre this month. Samson Ebukam Jersey
Delhi HC orders extension of Cairn India contract by 10 yrs on same terms
The Delhi High Court has ordered extension of Cairn India Ltd’s Rajasthan oil block contract for 10 years beyond 2020 on old terms and conditions, the company said in a regulatory filing. The court in an order yesterday directed the government to extend till 2030 the Production Sharing Contract (PSC) for Rajasthan block on the same terms and agreements when it was first entered into in 1995. “The Delhi High Court whilst pronouncing the judgment also directed Government of India to formally communicate its decision extending the Rajasthan Block Production Sharing Contract within two weeks,” Vedanta Ltd, formerly Cairn India, said in the filing. The 25-year contract for exploration and production of oil and gas from Barmer block RJ-ON-90/1 is due for renewal on May 14, 2020, but Cairn India has to, as per a new policy, apply for a 10-year extension. The government had in March last year approved a new policy for extension of PSCs that provided for an extension beyond the initial 25-year contract period only if companies operating the fields agree to increase the state’s share of profit by 10 per cent. “The Delhi High Court on May 31, 2018, allowed the writ petition filed by Vedanta Ltd, directing Government of India to extend the Production Sharing Contract for the Rajasthan Block for a period of 10 years beyond the current contract term in accordance with Article 2.1 of the Production Sharing Contract on the same terms and conditions,” the filing said. The company moved Delhi High Court as it felt that the May 1995 PSC for the block provided for an automatic 10-year extension on same commercial terms if there are oil and gas left to be produced. But the government had midway retrospectively changed fiscal terms. State-owned Oil and Natural Gas Corp (ONGC), which as a government nominee picked up 30 per cent stake in the Rajasthan block in 1995, also was of the opinion that PSC provides for an extension on same terms. ONGC had first in May 2015, then again on at least two occasions in 2016, concurred with Cairn’s interpretation of the PSC for extension of the Rajasthan contract by 10 years on same terms. Vedanta had moved the court after its request to the government in 2009 to extend the PSC did not elicit any response. It had claimed that the delay in a decision by the government was preventing it from infusing further investment of over Rs 30,000 crore in the project. Derrick White Jersey
Fuel price hike: A typo that could have cost Rs 18 crore a day
On Wednesday, a faux pas by the Indian Oil Corporation (IOC) led to an embarrassment of sorts after a ‘technical glitch’ on its website wrongly notified that petrol and diesel prices have been cut by 60 paise and 59 paise respectively, before it was found out that the reduction actually was of 1 paise per litre on both the petro products. The country’s largest fuel retailer later said in a statement, “There was a technical glitch in posting the selling prices of petrol and diesel. The selling prices of petrol and diesel with effect from May 30, 2018 have been rectified. Today, there is a minor reduction in fuel prices.” But what does 1 paisa really add up to for India and the oil companies? Here’s a look at some numbers: India consumed 7.6 crore litres of petrol a day in April. Thus, at 1 paisa a litre, India saves Rs 7.6 lakh a day on petrol. Similarly, India consumed 23.85 crore litres of diesel a day in April and the country saves Rs 23.85 lakh a day, courtesy a 1 paisa per litre cut on diesel. The typo or the ‘technical glitch’ as IOC likes to put it, if had gone unnoticed, would have cost oil companies Rs 18.5 crore a day (Rs 14 crore for diesel and Rs 4.5 crore for petrol). Meanwhile, on Wednesday evening Kerala took the 1 paisa cue and turned it into a real Re 1 a litre relief for its people. Wednesday’s cut albeit marginal, was the first time in 16 days that prices were cut since May 14 when fuel retailers ended a 19-day pre-Karnataka poll hiatus to pass on a spike in global oil rates. Petrol price was on Thursday has been cut by 7 paise a litre and diesel by 5 paise. Nate Prosser Jersey
Fuel price revision: IOC clarifies on erroneous price revision, cuts prices by 1 paisa after “glitch”
Indian Oil Corporation (IOC), the nation’s largest fuel retailer, today committed a faux pas on fuel price revision. The company slashed petrol and diesel prices by 60 paise and 56 paise, respectively, at 6 am in the morning in line with the daily routine of informing price revision, but issued a clarification 5 hours later stating a “technical glitch” had led to erroneous revision. “There was a technical glitch in posting the selling prices of petrol and diesel on our website today. The selling prices of petrol and diesel w.e.f 30th May 2018 have been rectified on our website. Today, there is a minor reduction in fuel prices,” IOC said in a statement. Petrol and diesel prices post IOC’s correction across the four metros including Delhi, Kolkata, Mumbai and Chennai have been reduced by 1 paise per litre. A company spokesperson clarified IOC had communicated the correct price revision to dealers despite the error in posting the prices on its website. Post the revision, petrol prices stood at Rs 78.42 per litre in Delhi. Prices in Kolkata Mumbai and Chennai were Rs 81.05, Rs 86.23 and Rs 81.42 per litre respectively, a decrease of one paise overTuesday’s prices. Diesel price in Delhi on Wednesday post revision stood at Rs 69.30 per litre. Prices in Kolkata Mumbai and Chennai were at Rs 71.85 per litre, Rs 73.78 and Rs 73.17 per litre respectively, a decrease of one paise over Tuesday’s prices. Domestic retail prices of petrol and diesel had been rising for the past 16 days following the 19-day price freeze initiated by OMCs before Karnataka polls. IOC had between 14 May and 29 May increased petrol prices by Rs 3.80 per litre and diesel prices by Rs 3.38 per litre in the national capital. Similar price hikes were implemented in other cities across the nation fuelling nation-wide protests and a call for excise duty cut. Mark Messier Jersey
Brazil’s president mulls scrapping Petrobras market-based fuel pricing -source
Brazil’s President Michel Temer may scrap a market-based pricing mechanism used by state-run oil firm Petrobras and revert to selling all fuel below costs after a trucking strike that almost paralyzed the nation, a government source told Reuters on Tuesday. Talk of temporarily lowering prices on just diesel to end the havoc the nine-day strike brought on Latin America’s largest economy sent Petrobras shares plunging 15 percent on Monday. Truckers are protesting a 50 percent increase in diesel prices under the two-year-old Petrobras policy of almost daily adjustments following international prices. The source, who asked not to be named because he was not authorized to speak publicly on the matter, said the pricing policy worked well when oil prices held steady for years at $40-50 a barrel, and the Brazilian currency remained stable against the dollar. But oil has recently surged to $70-80 a barrel boosted by plummeting Venezuelan production, strong global demand and looming U.S. sanctions on Iran. Meanwhile Brazil’s currency has weakened 11 percent this year on political uncertainty. “Without that (stability), we have a problem. We need to study alternatives,” the official said. He said talks on the issue have already begun between the government and Petrobras. A spokeswoman for Petrobras chief executive officer Pedro Parente declined to comment. Temer acknowledged in a television interview on Tuesday that he was open to reviewing the pricing policy. “Petrobras has recovered in these two years. It had been in a disastrous situation for a long time, and we did not want to change the company’s policy,” Temer told government broadcaster TV Brasil. “We can re-examine the policy, though with great care.” On Sunday, moving to settle the truckers strike, Temer announced tax cuts and subsidies to reduce domestic diesel prices by 0.46 real per liter, or about 13 percent of the current price at the pump, freezing them at that level for 60 days. The prospect of government interference in Petrobras pricing policy sent its share prices plummeting on Monday. That slide added to losses a week earlier that reduced the stock price by nearly one third, though shares rebounded 14 percent on Tuesday to close at 19.30 reais. The government official said initial talks had begun between Mines and Energy Minister Moreira Franco and Parente, architect of the company’s recovery. Parente has resisted change, but has appreciated the need for greater predictability in price adjustments, the official said. Dustin Brown Womens Jersey
Fuel price hike: Farmers protesting diesel rates hand over tractor keys to officials
Thousands of farmers drove down to the office of the local authorities in Samrala, Ludhiana to hand over the keys of their tractors as part of a unique protest against the rising diesel prices. Organised by the Bharatiya Kisan Union (Rajewal), the protesters alleged apathy on the part of the central government claiming that the incessant fuel price hikes were only adding to the woes of the debt-ridden farmers. “The price of diesel, which is an important input cost of cultivation, has risen so sharply that it has gone out of the reach of the farmers,” BKU (Rajewal) chief Balbir Singh Rajewal said. “The increase in the diesel prices has come at a time when paddy sowing is going to start next month. As per rough estimates, the rise in the fuel rates will put an additional burden of Rs 400-600 per hour for ploughing operations,” he claimed. The livid farmers blamed the high fuel prices for agricultural activities getting severely affected. “It has become unviable to carry out farming activities because of the fuel price hikes. We have come here on our tractors to hand over the keys to the district administration as we cannot afford to use them,” a farmer lamented. As hundreds of tractors converged on the Chandigarh-Ludhiana road in Samrala, the commuters had a harrowing time, while the administration scrambled to manage the massive traffic snarl. Corey Davis Authentic Jersey
U.S. record oil exports bite into Russia, OPEC market share in Asia
Record crude oil volumes exported from the United States will be heading to Asia in the next couple of months to take another piece of the market away from Russia and producers in the Organization of the Petroleum Exporting Countries (OPEC). The United States is set to export 2.3 million barrels per day (bpd) in June, of which 1.3 million bpd will head to Asia, estimated a senior executive with a key U.S. oil exporters. Data from the Energy Information Administration shows U.S. oil exports peaked at 2.6 million bpd two weeks ago. The record outbound volumes come as U.S. crude production hit all-time highs, depressing U.S. prices to discounts of more than $9 a barrel below Brent crude futures on Monday, the widest in more than three years and opening an arbitrage for excess supplies to other markets. The difference in the key benchmarks was a chance for Asian refiners to reduce light crude imports from the Middle East and Russia after Brent and Gulf prices touched multi-year highs, traders in Asia said. “We’re diversifying a lot to other regions. If Saudi Aramco still doesn’t reduce prices next month and ADNOC (Abu Dhabi National Oil Company) follows, we will increase our U.S. crude purchases,” a Southeast Asian oil buyer said. CHINA BUYS AMERICAN In Asia, China – led by Sinopec, the region’s largest refiner – is the biggest lifter of U.S. crude. The company, after cutting Saudi imports, has bought a record 16 million barrels (533,000 bpd) of U.S. crude, to load in June, two sources with knowledge of the matter said. India and South Korea are the next biggest buyers in Asia, each lifting 6 million to 7 million barrels in June, sources tracking U.S. crude sales to Asia said. Indian Oil Corp bought 3 million barrels earlier this month via a tender, while Reliance Industries purchased up to 8 million barrels, the sources said, although it wasn’t clear if Reliance’s cargoes would all load in June. The sources declined to be named due to company policies. South Korea’s purchases are driven by its top refiners SK Energy and GS Caltex. Taiwanese state refiner CPC Corp has also snapped up 7 million barrels to be lifted in June and July. U.S. exports to Thailand will increase to at least 2 million barrels. State oil company PTT PCL is 1 million barrels of WTI Midland, while Thai Oil and Esso Thailand bought at least 500,000 barrels of Bakken crude each, said traders with knowledge of the country’s crude deals. Reliance declined to comment. PTT, Thai Oil and Esso Thailand all did not respond to requests for comment. But even if Asia and Europe are keen to take more U.S. crude, the record volumes are straining export infrastructure in the United States, limiting its ability to pump and ship more oil. “Tight (shale) oil’s been eating OPEC’s lunch for the last few years. The lack of infrastructure will temporarily cede market share back to OPEC,” R.T. Dukes, head of U.S. Lower 48 oil supply at Wood Mackenzie said in a note last week. Curtis Martin Womens Jersey
Shell, Chevron returning to eastern Gulf of Mexico after storm
Royal Dutch Shell Plc was returning workers to the eastern Gulf of Mexico and Chevron Corp restored some production on Monday after the passage of Subtropical Storm Alberto, the companies said. Shell plans to restore production at its Ram Powell Hub in the Viosca Knoll area of the Gulf as it soon as it confirms the platform can be operated safely, the company said in a statement. On Friday, Shell shut in production at its offshore Ram Powell hub ahead of the storm’s move into the U.S. Gulf of Mexico. The facility is capable of processing about 60,000 barrels of oil and 200 million cubic feet of gas per day. Separately, Chevron restored production on the Blind Faith and Petronius production platforms in the Gulf after the passage of Storm Alberto, a company spokeswoman said on Monday. The two platforms were shut in as Alberto, the first named Atlantic storm of 2018, was charging across the eastern Gulf. The Atlantic hurricane season officially begins on June 1. The Gulf of Mexico is home to 17 percent of daily U.S. crude output and 5 percent of natural gas output, according to the U.S. Energy Information Administration. More than 45 percent of U.S. refining capacity and 51 percent of natural gas processing capacity are located along the Gulf. Devon Kennard Authentic Jersey