Diesel to be cheaper by 54 paise/litre as Delhi government slashes VAT
Diesel will be cheaper by 54 paise a litre from Saturday as the Delhi government late on Friday night reduced VAT to 15.75 per cent from 18.5 per cent. Diesel would now cost Rs 50.41 per litre against Rs 59.94 in Delhi. The new rates are at par with the price in Haryana, especially in respect to Gurgaon and Sonepat – the two cities that drew a lot of refulling business. Delhi has about 400 outlets with a combined daily sale of 1200 kilo-litres. The AAP government had some three months back raised VAT on diesel to 18.5 per cent from 16.5 per cent. This gave advantage to fuel retailers in neighbouring states, prompting a drop in sales at pumps in Delhi, especially those bordering Haryana and UP. However, diesel continues to be cheaper in UP even after the latest reduction in VAT. Chris Chelios Womens Jersey
Domestic crude export not economically justified: Centre to High Court
With nearly 85 per cent of India’s crude oil requirement being met by imports, it would not be “economically justified” to permit export of the country’s domestic crude production, the Centre has told the Delhi High Court. The submission was made by Additional Solicitor General (ASG) Tushar Mehta, appearing for the Ministry of Petroleum and Natural Gas, while opposing UK-based Vedanta group company Cairn India’s plea for permission to export excess crude from its Barmer oilfield. Defending its decision not to allow Cairn to export the crude, the ministry has said an empowered committee of secretaries has gone into the issue and concluded that India’s energy security would be adversely affected by allowing crude oil exports as then “more expensive” and “lighter crude oil” would have to be imported. “India has a total refining capacity of 223 million tons of crude oil. That in the present scenario only 38 million tons of crude oil from domestic production is available for refining in Indian refineries. “That the balance (84.9 per cent) crude oil is required to be imported to meet the domestic refinery capacity. Hence, allowing export of domestic production of crude oil is not economically justified,” the ASG told Justice Manmohan. The ASG, assisted by central government standing counsel Anurag Ahluwalia, also told the court that Cairn has “complete freedom to fix the price of crude oil”, that it sells to any domestic refinery, “on arms length basis” as the company has claimed it was forced to sell its share of crude to private players at prices 20 per cent less than global rates. With regard to Cairn’s earlier claim that selling its share of crude at lesser price has caused a loss of Rs 14 billion to the government, the ministry told the court that “we do not want to earn profit out of our natural resources” and added that crude oil cannot be exported presently as per its policy of zero per cent export till India attains self sufficiency. The court, thereafter, asked the government to place the policy before it by the next date of hearing on May 18. Roger Clemens Authentic Jersey
Cong for probe into Gujarat gas ‘scam’
After flagging it in Parliament repeatedly, the Congress today took the matter related to Gujarat State Petroleum Corporation (SGPC) gas exploration to President Pranab Mukherjee demanding a judicial investigation into the “scam”. Basing its demands on a CAG report which revealed recently that the GSPC fruitlessly invested around Rs 197 billion in exploration of gas in Krishna Godavari basin, the Congress said GSPC must be made accountable for loss of public money. The explorations were based on the purported discovery of India’s largest gas reserves, of 20 trillion cubic feet, valuing Rs 2220 billion in 2005 in the basin. An announcement to this effect had been made by the then Gujarat CM Narendra Modi. He had then promised commercial production from 2007 on an investment of Rs 15 billion. But no gas was found or produced. The Congress leaders led by party president Sonia Gandhi’s political adviser Ahmed Patel and comprising state unit chief Bharat Singh Slinky and Shankarsinh Vaghela argued before President for a judicial probe saying the state cannot be the judge in its own case. Jeremy Hill Authentic Jersey
Low inflation shows oil price benefit passed on: Pradhan
Minister defends fuel taxes as shield against shocks if oil prices climb again Oil Minister Dharmendra Pradhan, citing reasonable levels of inflation over the past two years, has strongly dismissed the perception that the government has failed to pass on the benefits of lower oil prices to Indian consumers “Since the last two years, the ballpark figures for inflation have been under control. How come? If we had not passed on the crude oil price benefit to the consumer, the transportation sector would not have seen so much rationality in prices,” Petroleum and Natural Gas Minister Mr. Pradhan said. “Today, 50 per cent of the profitability due to the slide in oil prices has been passed on to consumers. The remaining 50 per cent was kept with the Centre. Of that 50 per cent, 42 per cent is transferred to the states as per the 14th Finance Commission’s recommendations,” the Minister said, stressing that the Centre is focused on funding developmental priorities as a welfare state. He also defended the high taxation on fuels like petrol and diesel as a tool to protect people from a price shock when oil prices start to climb up again. “There is no developed country that has transferred the benefit of sliding oil prices to the consumers in any real way,” Mr Pradhan said. “If you make the consumer vulnerable by exposing him to low prices, then he will feel such a pinch when the prices go up,” he said, hinting at the government’s logic to raise taxes on fuels while global prices fell. Central and state-level taxes now account for around 60 per cent of the final price of petrol and 55 per cent of the final price of diesel in the national capital, as per official data. The minister said that the high proportion of taxes on petrol and diesel could be reduced when oil prices rise again. “That is a strategy. Again and again, I have stated in Parliament that if necessary, at one point of time, knowing the volatility of the oil economy, this could be done. Our first step was to bring some benefit to the customer, then to spend on welfare activities, and third, in the event of prices shooting up, do what we can to alleviate this,” he said. “We talk about energy. Is energy only the diesel that is put in sports utility vehicles (SUVs)? It is also the clean fuel that should go into houses,” Mr Pradhan said, stressing that the Centre has been using the fuel tax receipts to finance critical development programs such as affordable housing, cooking gas connections for the poor and so on. “LPG came in the country in 1955,” he added. “From then to May 2014, India had 130 million active LPG connections. In the last 22 months, we have added 35 million new LPG connections and we have brought in the Ujjwala Yojana where, in the next three years, we will add five crore LPG connections in the names of the women in BPL households, with financial support from the government.” In addition, he pointed to the Power Ministry’s rural electrification programme, saying that the target to electrify the 18,000-odd villages that have so far remained without electricity has also meant a higher expenditure. Highlighting the government’s schemes to provide 1.5 crore houses by 2019, Mr Pradhan said that the erstwhile scheme—Indira Awaas Yojana—has been expanded under this government, which has resulted in a higher expenditure. “We made a provision in the Budget and started spending. Where will the money come from?” he said. D.J. Fluker Womens Jersey
Domestic gas users in major cities need income proof for subsidy claim
Consumers in Tier-I and II cities will have to submit affidavits to their LPG distributors stating that their annual income is below Rs.10 lakh to continue to receive cooking gas subsidy, according to Oil Minister Dharmendra Pradhan.“In the Tier-I and Tier-II cities, when somebody comes to refill gas, they are asked to sign an affidavit regarding their income,” the Minister said. “It is a matter of trust. We have to trust our people, and they are trustworthy. I didn’t believe that 1 crore people would give up their subsidy, but they did.” One crore people While over one crore people have given up LPG subsidy over the past year, an extensive government survey in the most affluent areas of metropolitan cities has revealed that only three per cent of its residents had done so.“We did a market survey of one lakh well-to-do localities in the metros, ones where the proportion of people earning Rs.10 lakh or more would be high — South Delhi, South Mumbai, South Bangalore, Salt Lake City in Kolkata, parts of Pune and Chennai,” Mr.Pradhan told The Hindu. “Only 3 per cent of these people had given up their LPG subsidy.” In March this year, the government sought to use Income Tax records to identify high income earners and sent them messages informing them that they are no longer eligible for subsidised cooking gas. But that plan was dropped, the minister indicated. “If the Income Tax Department is not entitled to share the data, then how would I know (what the data says)?” Mr. Pradhan asked. “The law is the law. It is a matter of privacy. The Finance Ministry is bound by the principle of privacy of Income Tax information,” he said. Now, instead of identifying ineligible beneficiaries, the government has cast the net wider by making it incumbent upon users to submit affidavits declaring that their income is less than Rs.10 lakh. Earlier, oil ministry officials had told The Hindu that 3 lakh people earning Rs.10 lakh or more had been identified using Income Tax data. Last month, Mr. Pradhan said those who had voluntarily given up their LPG subsidy could re-apply for it after a year. In Parliament on April 24, he said that the government had decided to “exclude” those earning Rs.10 lakh or more from the purview of the LPG subsidy. Nick Markakis Jersey
Show us law which bans crude export: Delhi high court to govt
The Delhi high court asked the union government to show any statutory source or policy document which barred export of crude in India. Justice Manmohan, hearing a case filed by Cairn India Ltd, a Vedanta group company, asked the government to back up its claim that crude exports are not permitted. “After all, you’re restricting someone’s right to sell (crude). It has to be found in law or some contract,” Manmohan said. “Let me see the policy. When did you frame it?” The court will hear the case next on 18 May, when a response from the government can be expected. Cairn India moved the high court against the Director General of Foreign Trade seeking permission to be permitted to export excess crude it generated from the Barmer oil fields in Rajasthan. Additional solicitor general Tushar Mehta told the court crude oil per se was not allowed to be exported. He said that India had a total refining capacity of 223 million tonnes. However, at present only 38 million tonnes of crude oil is available. It would not be in the interest of the country to export crude, he argued. He stressed that the issue of export of crude was entirely in the realm of policy. Lawyer C.A. Sundaram, representing Cairn, said that they were agreeable to offering the domestic players in the country the first option to buy the crude, but at international prices. He said that neither the government, nor its nominees or public sector refineries were ready to purchase its crude and it was forced to sell to two private refineries—Reliance and Essar. Sundaram said that Cairn had brought $10 billion as investment on promises. But it was being forced to sell at less than standard prices and was not allowed to export either. Cairn India argued in earlier hearings that the foreign trade policy doesn’t bar export of crude. However, Mehta said that the DGFT didn’t permit this export. Justin Gilbert Authentic Jersey
Saudis Arabia raises oil pricing for Asia by most since April last year
Saudi Arabia raised its pricing for June oil sales to Asia by the most since April 2015, a sign that the world’s biggest crude exporter expects demand to recover as the global market rebalances. State-owned Saudi Arabian Oil Co. increased its official selling price for Arab Light crude to Asia by $1.10 a barrel to 25 cents more than regional benchmarks Oman and Dubai, according to a statement. The company, known as Saudi Aramco, was predicted to raise the grade by 65 cents a barrel, according to the median estimate in a Bloomberg survey of five refiners and traders. The Middle East producer is boosting the cost of its oil to the largest consuming region as unplanned supply outages and disruptions help to curb a global glut and signs of higher demand emerge. Benchmark prices have rallied more than 60% since mid-February, rebounding from the biggest crash in a generation on expectation that the surplus will shrink as US production declines. Arab Light’s price to Asia for June is the highest since September. It’s only the third time the grade is being sold at a premium to the benchmarks since Saudi Arabia spearheaded the strategy of the Organization of Petroleum Exporting Countries to keep pumping out crude in November 2014. The group’s decision to maintain output as prices cratered forced a curtailment of higher-cost production elsewhere. Higher demand “Refinery demand is expected to recover,” said Ehsan Ul-Haq, a senior analyst at industry consultant KBC Energy Economics in London. “Cargoes loaded in June will arrive in Asia in July, when demand will return after the seasonal turnaround period. Saudi Arabia may also use more crude at home in the summer, when electricity usage typically rises.” Aramco will sell Arab Medium for June to Asia at $1.30 a barrel below benchmark prices, and Arab Heavy at a discount of $2.75 a barrel. The company raised the premium for Arab Super Light crude to Asia by $1 a barrel to $3.95 a barrel over benchmarks, and Arab Extra Light by 80 cents a barrel to $2.60 a barrel. The differential for Arab Light sold to the US was kept unchanged at a premium of 35 cents a barrel to the ASCI benchmark. Other grades for the US were all lowered by 20 cents month-on-month, resulting in a $2.40 premium for Extra Light, a $1.25 discount for Medium and a $1.75 discount for Heavy. Europe, Mediterranean Light crude to Northwest Europe was raised by 15 cents to a discount of $4.45 versus the benchmark. Other grades were also increased except Extra Light. Light crude to the Mediterranean was raised by 25 cents to a discount of $3.95 versus the benchmark. Opec, of which Saudi Arabia is the largest producer, abandoned its production ceiling at its most recent meeting in December. The group has pumped more than the previous 30 million-barrel-a-day target since June 2014. Saudi Arabia produced 10.27 million barrels a day in April.Opec is scheduled to meet 2 June in Vienna Karl Mecklenburg Womens Jersey
India, Iran agree to clear $6.4 billion in oil payments via European banks
The central banks of India and Iran have reached an arrangement to use European banks to process pending oil payments to Tehran, India’s oil minister Dharmendra Pradhan told Reuters, unlocking $6.4 billion in stalled funds. Buyers of Iranian oil were prevented from using global banking channels to clear their transactions after sanctions were imposed on Iran in 2011 over its nuclear programme. With the end of those sanctions in January, after an agreement to curb the programme, Iran is finally gaining needed access to the funds. Iran hopes the money will revive its moribund economy and raise Iranian living standards as well as help to integrate the country into the global economic system. Indian refiners have been holding 55% of its oil payments to Iran after a route to make payments through Turkey’s Halkbank was stopped in 2013, although payment of some of those funds was allowed after an initial temporary deal to lift the sanctions. “There is an agreement between (India and Iran’s) central banks. European banks will be the clearing agent. They will be dealing with Iranian banks and we have to pay those European banks,” Pradhan told Reuters in an interview. He did not elaborate further, saying the finance ministry was dealing with the issue. Also because of the previous sanctions, Indian refiners have been depositing 45% of their oil payments to Iran in rupees with India’s UCO Bank. Tehran has been using the funds, currently about Rs.13,000 crore ($1.95 billion) to import non-sanctioned goods from India. Indian government sources said during Pradhan’s visit to Tehran last month Iran had asked India to consider clearing the oil payments through Europaeisch-Iranische Handelsbank (EIH) of Germany, Central Bank of Italy and Halkbank of Turkey. One of the sources said the Reserve Bank of India (RBI) has ruled out channelling funds through Halkbank. “Halkbank’s Iran-related foreign trade activities with Iran have been carried out since 2004 … Halkbank will continue its operations in accordance with international law,” a senior Halkbank official told Reuters. No immediate comment was available from EIH and Central Bank of Italy. The government sources said Indian refiners will remit funds to Iran through state-owned UCO Bank. UCO Bank’s chairman did not respond to calls from Reuters to his mobile phone. Reserve Bank of India governor Raghuram Rajan said on 5 April India will make payments to Iran in a staggered manner. “Oil companies are working out the banking arrangements in coordination with Iranian counterparts and payments will be made by them presumably over time with minimal impact on the market,” an RBI spokesperson said on Thursday. Despite the sanctions, India continued its engagement with Iran and was among a handful of countries that sourced oil from Tehran. Iran was India’s second-biggest oil supplier before the sanctions hampered its trade relations. The country is set to import at least 400,000 barrels per day of Iranian oil in the year from 1 April. Darrell Green Authentic Jersey
India to gradually move to gas-based economy: Dharmendra Pradhan
India plans to shift to a gas-based economy by boosting domestic production and buying cheap liquefied natural gas (LNG) as the world’s third-biggest oil importer seeks to curb its greenhouse emissions, oil minister Dharmendra Pradhan said. New Delhi has promised to shave a third off its emissions rate by 2030, partly by boosting the use of cleaner burning fuels. “Gradually we are shifting towards a sustainable gas economy,” Pradha said. Gas accounts for about 8 percent of India’s energy mix, while oil accounts for more than a quarter. India’s gas supply deficit is expected to widen from 78 million cubic metres a day (mscmd) this fiscal year to 117 mscmd in 2021-22, according to a government estimate. India recently negotiated better terms for a long-term LNG deal with Qatar and importer Petronet LNG is in talks with Exxon to renegotiate pricing for gas from Australia’s Gorgon project. “The price should be affordable to us. We respect long-term contracts but everybody has to appreciate the changing scenario,” said Pradhan. “In a bigger canvas … India has the potential of a huge market base”. Pradhan last month visited Saudi Arabia, the United Arab Emirates and Iran to deepen ties with its main oil suppliers. “We want to move beyond a buyer-seller relationship,” he said, adding that India was offering them stakes in its pipelines, petrochemical complexes and refineries. India is also in talks with Abu Dhabi National Oil Co and Saudi Aramco to lease strategic oil storage. GAS GIANT Pradhan said Prime Minister Narendra Modi’s visit to Iran later this month would “certainly” deliver concrete results. Iran has set aside its Farzad B gas field for development by Indian firms, a move that could result in the building of an LNG plant as India consumes or markets its production share, he said. Over two years Asian LNG prices have slumped by three quarters to $4.65 per million British thermal units (mmBtu). Pradhan expects hefty LNG investments worldwide to ensure affordable long-term prices, a trend that “will suit India as a consuming country.” GAS CONNECTIVITY India is building import terminals on its eastern and western coasts and pipelines to boost industrial use of gas. In the fiscal year to March, India’s gas production declined by about 4.2 percent, while imports rose around 15 percent. India recently offered better gas pricing to boost domestic output, but its most recent investment in an LNG terminal in the southern state of Kerala has been underutilised since it lacks pipelines to connect to demand centres after farmer opposition caused land acquisition problems. Pradhan said the government was talking to the states and hoped obstacles to a pipeline connecting Kochi to Mangalore would be resolved after state elections in Kerala. Clay Matthews Womens Jersey
India LNG Market Projected to grow at a CAGR of More Than 21% During 2016-2025
Research and Markets has announced the addition of the “India LNG Market Forecast & Opportunities, 2025” report to their offering. “India LNG Market Forecast & Opportunities, 2025”. Increasing focus on expansion of gas pipeline infrastructure, rising demand for natural gas from power and industrial sectors coupled with favorable government policies is making LNG a commercially viable fuel for an increasing number of end users industries in India. As a result, LNG demand is forecast to witness robust growth over the next 5-10 years. The total opportunity for RLNG in India is projected to increase from an estimated 52.34 mmscmd in 2016 to 305.10 mmscmd by 2025, registering a CAGR of more than 21% during 2016-2025. Upcoming LNG terminal projects, surging demand for natural gas in India and cost-effectiveness of LNG as compared to other alternative fuels are among the major factors anticipated to positively influence the country’s LNG market scenario over the next ten years. In addition, emergence of SSLNG market is opening up new opportunities for the industry. Other policies like E-bid RLNG are also expected to play a crucial role for supplying imported RLNG to power plants and fertilizer industry over the course of next ten years. Kevin Durant Jersey