Nayara Energy Sees 14% Rise in Domestic Fuel Sales, Exports Drop
Nayara Energy, India’s largest private fuel retailer, posted a 14.3 per cent rise in fuel sales for the second quarter of the 2024 calendar year, while exports dropped as the firm met rising local demand for fuel. In the April-June quarter, Nayara sold 75 per cent of all diesel it produced at its Vadinar oil refinery in Gujarat in the local Indian market and 60 per cent of its petrol production locally, Nayara said. Over the past few years, Nayara Energy has steadily built its domestic business while expanding its fuel retailing network strategically to underserved markets that uphold the potential to fuel India’s growth. Retail diesel sales rose 14 per cent to 2.08 million tonnes in April-June from 1.82 million tonnes a year back, while institutional business’ year-on-year growth was 23 per cent, Nayara said. Similarly, retail petrol sales grew 14.7 per cent to 0.916 million tonnes in the second quarter compared to 0.809 million tonnes a year back. Nayara Energy owns the largest private retail network with over 6,500 petrol pumps across India. Its retail network is fully automated (99 per cent of petrol pumps) for enhanced controls and standards, enhancing mobility and connectivity within our nation.
India’s Renewable Energy Journey To Serve As Model For Other Emerging Economies
As the world’s largest democracy and a rapidly developing nation, India’s renewable energy journey will serve as a model for other emerging economies navigating the path to sustainability, Pralhad Joshi, Union Minister of New and Renewable Energy, has said. The country aims to achieve net-zero carbon emissions by 2070, focusing on renewable energy expansion, and plans to reach 500 GW of non-fossil fuel energy capacity by 2030. According to the minister, the country’s renewable energy journey is supported by strong policy backing and international partnership. For example, initiatives like the International Solar Alliance (ISA), cofounded by India and France, seek to promote solar energy use worldwide, particularly in developing countries. “Despite having one of the lowest per capita emissions in the world, India is not only championing the cause of clean energy under Prime Minister Narendra Modi, but also inspiring other nations to join the cause,” Joshi said. PM Modi said last month that India is the only G20 country to have ensured that the pledge towards creating a green planet made at the Paris Climate Change Summit in 2015 was fulfilled even before the deadline. The country has now updated its targets to reduce emissions intensity of its GDP to 45 per cent by 2030 from the 2005 level, and cumulative electric power installed capacity from non-fossil fuel-based energy resources to 50 per cent by 2030. Currently, the total installed capacity of solar photovoltaic (PV) power in the country stands at 85.47 gigawatts (GW) and wind power at 46.65 GW. The Centre has undertaken several measures and initiatives to promote the development of renewable energy (RE), including solar and wind power. As the country aims to achieve 500 GW of installed electric capacity from non-fossil sources by 2030. the government has permitted Foreign Direct Investment (FDI) up to 100 per cent under the automatic route. According to the Economic Survey, the country has a well-established infrastructure to attract FDI in sectors like greenfield projects such as renewables.
ONGC Gets Director To Spearhead New Energy, Petrochem Business
Oil and Natural Gas Corporation (ONGC) has got a new director to spearhead its new energy, petrochemicals and corporate strategy as part of a board revamp aimed at breathing fresh life into the state-controlled behemoth. Arunangshu Sarkar has been appointed as Director for strategy and corporate affairs, ONGC said in a stock exchange filing. Before the elevation, Sarkar, a petroleum engineer from the Indian School of Mines, Dhanbad, was Group General Manager (Production) at ONGC. He had previously worked as General Manager (Strategy & Corporate Planning), ONGC Videsh Ltd – the overseas investment arm of ONGC. Two years back, the board of ONGC was reorganised. Besides creating the new post of Director (Strategy & Corporate Affairs), the post of Director (Production) was created after merging Director (Onshore), who is in charge of all oil and gas fields located on land, and Director (Offshore) who looks after all offshore assets, such as the prime Mumbai High fields.
Abu Dhabi gives onshore block production license to India’s IOC-BPCL JV
Abu Dhabi has awarded oil and gas production rights for an onshore block to a joint venture of Indian state-run refiners Bharat Petroleum Corp Ltd and Indian Oil Corp , BPCL said in a statement The Supreme Council for Financial and Economic Affairs of Abu Dhabi has granted rights to Urja Bharat Pte Ltd, an equal joint venture of Indian Oil and Bharat PetroResources, BPCL’s exploration and production arm. The Indian companies have been given production rights for onshore block 1 after completing the exploration phase awarded in 2019.
OMCs may reduce fuel prices if crude stays low: Petroleum Secy
State-run oil marketing companies (OMCs) may consider lowering petrol and diesel prices if international crude oil prices remain subdued for an extended period, said Pankaj Jain, secretary at the ministry of petroleum and natural gas. His statement comes as Brent crude has traded below $75 per barrel for over a week. “OMCs will consider a cut in retail prices if international prices of crude oil remain subdued for a longer duration,” Jain told reporters at the sidelines of the International Conference on Green Hydrogen. He added that the state-run companies, along with the government, would monitor price trends over time before making a decision. Earlier this month, global oil prices reached three-year lows due to demand concerns. Currently, Brent crude for November contracts on the Intercontinental Exchange is trading at $71.81 per barrel, up 1.7% from the previous close. This drop in oil prices is expected to improve the profitability of OMCs, which could pass on the benefit to consumers through price cuts. India imports 85% of its energy requirements, making international oil prices a key factor in domestic fuel pricing.
Russia’s search for new crude markets helps India cut its oil import bill
Russia’s diligent efforts to find markets for its crude oil and refined fuels since the Ukraine war, and ongoing tensions in the Red Sea are yielding conflicting outcomes for India’s crude purchases and diesel exports. Indian refiners are benefiting from lower crude prices but diesel exports to Europe are facing major challenges on the volume and margin front. Russian oil started flooding the Indian market soon after the start of the Ukraine war in February 2022 as European nations began closing their markets to Moscow. Russia’s share in India’s crude imports spiralled from less than 1% before the war to 42% in the first five months of this fiscal year, pushing down the share of other key suppliers like Iraq, Saudi Arabia, the UAE, and the US, according to energy cargo tracker Vortexa. At the same time, Russia’s aggressive inroads into the South American diesel market has negatively impacted Indian refiners. “Europe, which was a key market for Indian diesel, saw increased competition from US Gulf coast supplies. This is an effect of Russian diesel eating into the share of US exports to South America, which forced US exports to divert towards Europe instead and, in turn, led to lower Indian exports,” said Rohit Rathod, an analyst at Vortexa.
LNG buyers flag US supply risks of purchase after Biden pauses export
Major buyers of liquefied natural gas (LNG) flagged risks of purchasing cargoes from the United States following the decision by President Joe Biden’s administration to pause export permits of the superchilled fuel to non-Free Trade Agreement countries. Officials from Taiwan’s CPC Corp and Germany-based SEFE, which trades LNG cargoes and sells in Asia, stressed the importance of reliability of supply while responding to a question on the impact of the US export pause on Asian markets. “I do trust the traditional LNG suppliers more than US LNG players,” said Jane Liao, vice president at CPC, told the APPEC conference. “Most of the Asian buyers, we rely on traditional LNG suppliers, which cherish the loterm relationship more. When you are in difficulties in the implementation of your contract, people will sit down and talk,” she said. Fabian Kor, executive vice president Asia at SEFE, said energy security was the topmost priority this year, adding that SEFE may even “slightly over contract” to ensure availability. “We will not concentrate on supply, just because it is the cheapest in the U.S. We like a bit of geographical supply diversification,” he said. On supplies of Russian LNG, Liao also said Chinese and Indian purchases of Russian LNG cargoes would ensure the market remains in balance. “Let’s say the Chinese companies or the Indian companies, they continue to purchase from Russia, so they won’t compete with us in the rest of the market,” she said.
Oil Prices Tumble as Traders Turn Bearish
Rising global oil supply and weaker-than-expected demand have made traders increasingly bearish on oil prices. Hedge funds and other money managers accelerated their selling in the most traded petroleum futures contracts in the latest reporting week to September 3. Portfolio managers slashed their overall net long position—the difference between bullish and bearish bets—to the lowest level since exchanges began compiling such data in 2011. The positioning in crude oil was already tilted to the bearish side in the previous reporting week to August 27, as traders had more than halved their bullish bets since early July. The week to September 3 saw additional selling and a market rout in which oil prices dipped to their lowest level so far this year. The prospect of a return of Libyan oil exports—after a halt amid a political feud—and continued weak Chinese data and weaker outlooks of its economic growth have weighed on market sentiment. As a result, the combined net long position on the two crude oil benchmarks, Brent and WTI, was slashed by 99,889 lots to just 139,242 lots in the week to September 3, according to data from exchanges cited by Bloomberg. This was the lowest bullish positioning in data from ICE Futures Europe and the CFTC since ICE began collecting such data in March 2011. The net long position in the U.S. benchmark WTI Crude was slashed by 62,000 lots to 125,000 lots. The net long in Brent Crude was nearly halved to about 42,000 lots in the week to September 3. “Including the three fuel products the net long slumped to 121k contracts, lowest recorded energy exposure since 2011 when ICE began collecting data,” Ole Hansen, Head of Commodity Strategy at Saxo Bank, said. Fears of slowing economies in China and the United States continued to drive speculators and hedge funds, as did concerns about oversupply with an OPEC+ production increase. After the end of the reporting week to September 3, the OPEC+ group decided to delay the planned rise in output by two months from October to December. However, this did little to reverse the bearish market sentiment, and prices slipped after the announcement at the end of last week. Demand concerns trumped the alliance’s decision to delay adding 180,000 barrels per day (bpd) to supply. Last week, WTI Crude saw its worst weekly performance since October 2023, with an 8% drop for the week. On Friday, WTI and Brent settled at their lowest levels since June 2023—at $67.67 and $71.06 per barrel, respectively. Early Monday, prices rebounded by 1% following the selloff last week, partly due to forecasts that a weather system in the Gulf of Mexico could become a hurricane. The early Monday rebound, however, is being overshadowed by concerns about the U.S. and Chinese economies. Weak U.S. jobs data on Friday, with a lower number of jobs created than expected, rekindled fears of recession. Yet, the data paves the way for the Fed to cut interest rates next week. A rate cut could boost demand for oil if economic growth picks up. However, Chinese economic data continues to drag commodity prices down. Major Wall Street banks, including Goldman Sachs, JP Morgan, Citi, and Bank of America, have already cut their forecasts of China’s GDP growth to below the official Chinese target of “about 5%” economic growth this year. BofA was one of the latest to lower its estimate to 4.8% from 5%, saying earlier this month, “We find both the fiscal and monetary policy stance less accommodative than desired and insufficient to revive domestic demand growth.” Improving Chinese demand would be vital in turning the current exceptionally bearish sentiment on oil, as would a rebound in the U.S. economy following the expected Fed rate cuts.
ADNOC pens 15 year LNG supply HOA with IndianOil
Abu Dhabi’s ADNOC has entered into a 15-year heads of agreement with IndianOil, the state-owned Indian energy company, for the supply of 1mn tonnes/year of LNG, as announced by the Abu Dhabi Media Office on September 9. The announcement followed a meeting between Sheikh Khaled bin Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, and Indian Prime Minister Narendra Modi during Zayed Al Nahyan’s visit to India. The Abu Dhabi Media Office did not provide any other information about the HoA. The LNG will primarily be sourced from ADNOC’s lower-carbon Ruwais LNG project, currently under development in Al Ruwais Industrial City, Al Dhafra, Abu Dhabi. This facility will be the first in the MENA region to export LNG using clean power, according to ADNOC. Upon completion, the project will feature two LNG liquefaction trains, each with a capacity of 4.8mn tonnes/year, totalling 9.6mn tonnes/year. This expansion is expected to more than double ADNOC’s current LNG production capacity, increasing from 6mn tonnes/year to approximately 15mn tonnes/year.
Government aims to power 33% of trucks on LNG by 2030
The Indian government is planning a major shift towards liquefied natural gas (LNG) to power a third of the country’s long-haul heavy-duty vehicle (HDV) fleet over the next 5-7 years. A draft proposal from the Ministry of Petroleum and Natural Gas outlines steps to make this transition possible, including allocating domestic gas for LNG supply. According to the ministry’s plan, 0.5 million metric standard cubic meters a day (mmscmd) of domestic natural gas may be allocated for an initial period of three years to ensure stable and predictable LNG prices. This allocation is expected to power 50,000 trucks within the next 2-3 years. To further support this transition, the ministry has proposed the establishment of small-scale liquefaction plants in off-grid areas to convert biogas into bio-LNG. This would enhance the availability of bio-LNG for transport. The oil ministry has already directed state-run oil companies to set up 49 LNG dispensing stations across the country. Additionally, oil marketing companies may incentivise fleet owners to convert diesel trucks to LNG-powered trucks, accelerating the shift towards cleaner fuel. One of the pilot initiatives under consideration is developing the Delhi-Mumbai expressway as an LNG highway. The proposal suggests exempting LNG-powered trucks from toll taxes on this route, which could significantly reduce operational costs and encourage faster adoption. With LNG offering a 24% lower emission factor than diesel, this transition aligns with India’s sustainability goals. Currently, medium and heavy commercial vehicles consume about 40% of all diesel in the country. By promoting LNG adoption, India aims to reduce its carbon footprint and enhance the efficiency of its transport sector.LNG trucks, oil ministry, LNG, LNG in heavy-duty vehicles, LNG for trucks in India, sustainable transport India, LNG dispensing stations, bio-LNG in transport, Delhi-Mumbai LNG highway, diesel to LNG conversion.