India, the world’s third-biggest oil importer and consumer, signalled on Tuesday that a spike in oil prices would speed up the transition to alternative energy sources.
India has been at the forefront of efforts to urge the Organisation of Petroleum Exporting Countries (OPEC) to ensure “responsible pricing” of oil that suits both producer and consumers.
“Last week, crude oil prices inched upwards to seven-week highs. The cost of crude oil has considerable impact on the pace of energy transition pathways,” Petroleum Minister Hardeep Singh Puri said at the launch of OPEC’s World Oil Outlook.
“It is in the collective global interest that energy transition should be orderly.”
With oil demand recovering, OPEC and its allies such as Russia – a grouping known as OPEC+ – are unwinding record supply cuts made last year. But there are signs some OPEC+ producers are unable to pump more due in part to a lack of investment, and that has boosted prices.
Oil markets climbed for a sixth day on Tuesday. Brent crude futures gained 72 cents to $80.25 a barrel at 1353 GMT, after reaching their highest level since October 2018 at $80.75.
Mr Puri also said India, a major driver of oil demand growth, imports about 80 per cent of its oil needs and wants stronger relations with OPEC.
India shipped in 71 per cent of its oil needs from OPEC countries in the last fiscal year to March 31, 2021, he said.
The minister said that OPEC played a major role in “shaping oil prices and availability”.
“India, with a huge energy market, has a vital interest in this regard and we look forward to OPEC’s leadership in ensuring this,” he said.