New Delhi: After the US, Japan and other major economies, India also plans to release around 5 million barrels of crude oil from its strategic reserves, according to the government’s main official.
The decision came as part of a coordinated movement with the US and other ally in an effort to cool international oil prices.
This is the first time India released crude oil from the stack of emergency stock.
In total, India saves 5.33 million tons or around 38 million barrels of crude oil in underground caves in three locations on the east and west coast.
In the coming 7-10 days, 5 million barrels of stack of stock will be released.
India and other countries can also see more tranches sales later.
However, the official announcement of this problem is expected immediately.
Crude oil will be sold to distillers including those operated by Mangalore Refinery and Petrochemicals and Hindustan Petroleum Corp.
because this is connected by pipes to strategic reserves.
The release is symbolic because it shows oil consumers willing to unite against the OPEC government over the market.
Organizations of Petroleum Exporting Countries (OPEC) and its allies have repeatedly ignored the demand by several major economies to accelerate the increase in their production.
The US last week made unusual requests to several countries that eat the largest oil in the world, including China, India and Japan, to consider releasing crude oil stocks in coordinated efforts to reduce global energy prices.
India has become the strongest about flexing its muscles as main oil consumers, cutting shipments from Saudi Arabia about a quarter after OPEC + expanded production cuts.
Oil Minister Hardeep Singh Puri last week in Dubai said high prices would damage the global economic recovery.
“We are trying to release stocks from strategic reserves we coordinate with other countries,” the official said.
“The release time will depend on the US making an official announcement.” India is the third largest oil consumer in the world and importing countries and has been greatly affected by the increase in international oil prices without stopping.
OPEC and other allied manufacturers – including Russia, it is known collectively as OPEC + – has reached around 4,00,000 barrels per day to market every month, which many views are not enough to cool prices that increase with increasing demand.
to the pre-pandemic level.
The threat of a coordinated release, along with new coronavirus related locking in Europe, has dropped the wind from the crude oil rally.
Brent crude fell to $ 78 a barrel this week, from $ 86.40 hit peak barrels on October 26.
Oil prices, however, edged on reports that OPEC + can adjust the plan to raise oil production if large consuming countries release their backup or if the coronavirus pandemic dampens demand.
Brent crude traded at $ 79 per barrel.
Just like the US, India also believes that high prices began to produce unwanted inflation and weaken the recovery from Covid-19 pandemic.
Retail gasoline and diesel prices soared to record the initial level this month before the government cut taxes, cost 60,000 crore rs in revenue this year.
While China said it was working on the release of crude oil, Japan also signaled its readiness.
India has built 1.33 million tons of storage in Visakhapatnam at Andhra Pradesh, 1.5 million tons in Mangaluru and 2.5 million tons in trading (both in Karnataka).
The official said that stocks from reserves will be released together with other countries.
“Date, etc.
is being done,” he added.
(With input from Bloomberg, PTI)