Oil prices rose on Friday after the death of Saudi Arabia's king added more uncertainty to an oil market that has more than halved over the last six months. King Abdullah bin Abdulaziz died early on Friday and his brother Salman became king of the world's top oil exporter. Salman named his half-brother Muqrin as heir and nephew Mohammed bin Nayef, 55, as Deputy Crown Prince, moving to forestall any succession crisis at a moment when Saudi Arabia faces unprecedented turmoil on its borders. Saudi state television said King Salman intended to keep oil minister Ali al-Naimi in place, suggesting the country's oil policy would remain unchanged. Harry Tchilinguirian, senior oil strategist at BNP Paribas, said he expected no change in Saudi oil policy. "King Salman was already involved in policy making prior to the passing of the king," he said. "So from that perspective, if he helped set the agenda, he will maintain that agenda." Brent crude futures were trading at $49.42 a barrel by 1215 GMT, up 90 cents. U.S. WTI crude futures were at $46.60, up 29 cents. After seeing strong volatility and price falls earlier in January, oil markets have moved little this week, with Brent prices range-bound between $47.78 and $50.45 a barrel. The new Saudi king is expected to continue an OPEC policy of keeping oil output steady to protect the cartel's market share from rival producers. Abdullah's death comes amid some of the biggest shifts in oil markets in decades. Oil prices have fallen by almost 60 percent since peaking last June as soaring supplies of shale oil from North America have clashed with cooling demand. Booming U.S. production has turned the United States from the world's biggest oil importer into one of the top producers, pumping out over 9 million barrels per day. Data from the Energy Information Administration on Thursday showed the biggest build in U.S. crude inventory in at least 14 years, driving Brent and WTI prices apart. To combat soaring output and falling prices, many oil exporters, such as Venezuela, wanted the 12-member Organization of the Petroleum Exporting Countries (OPEC) to cut output in order to support prices and revenues. Yet, led by Saudi Arabia, OPEC announced last November it would keep output steady at 30 million barrels per day.
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India has asked its refiners to slash oil buys from Iran in the next two months to keep the imports in line with the previous fiscal year's levels, sources with knowledge of the matter said, days ahead of President Barack Obama's visit to New Delhi. India, the second-largest buyer of Iranian oil, has raised its crude shipments from there by more than 40 percent over the first nine months of the current fiscal year, when as part of the temporary deal that eased some sanctions on Tehran it was meant to hold them steady. Now, the sources said, India's oil ministry has told Essar Oil, Mangalore Refinery and Petrochemicals Ltd and Indian Oil Corp -- the Indian refiners that buy from Iran -- to cut those imports to keep the annual figure in line with the nuclear deal. "This is very much about U.S. pressure. India does not want Obama's visit to be overshadowed by some dispute over sanctions," said Robin Mills, head of consulting at Dubai-based Manaar Energy. "India is encouraging its companies to cut back on imports because the U.S. demand has been that countries taking Iranian oil should not increase purchases from 2013 levels," he said. Still, India's imports from Iran rose to 250,200 barrels per day (bpd) in April-December last year, up 41 percent compared with the same period in 2013, according to tanker arrival data made available to Reuters. China, Tehran's biggest oil client, has also increased its oil imports from Iran over the last year by about 30 percent. But with reduced purchases from Japan and South Korea, the other main buyers of the oil, Iran's exports to Asia are holding around 1 million to 1.1 million bpd. That's about half of Tehran's total exports before toughened sanctions aimed at its nuclear activities were put in place in 2012, and a level U.S. officials have said is allowed under the temporary deals that have eased some of the measures and given Iran access to some of its frozen oil revenues. Iran and six major world powers are due to meet next month to narrow differences over Tehran's nuclear programme after making limited progress earlier in January to clinch a more permanent agreement by a June 30 deadline. Cutting Oil ImportsDuring Obama's visit, the United States will update India on the progress of the Iran nuclear negotiations, Ben Rhodes, deputy national security advisor in the White House told reporters in a teleconference call. India's higher imports from Iran would also be on the agenda, said the two sources in India, who did not want to be named because of the sensitivity of the issue. "The refiners will have to virtually halt Iranian oil imports in February-March to retain purchases at last year's levels," said one of the sources. Essar, the biggest Indian buyer of Iranian oil, has already said it will not be taking any of the oil over the next two months, said this source, while IOC has said its buys from Iran will be slightly less in the year to March 31, 2015, than in the previous fiscal year. "MRPL may have to arrange oil from elsewhere as it was planning to lift 100,000 bpd from Iran this year," the source said. State-run MRPL has issued a rare spot tender seeking supplies of 1 million barrels of high sulphur oil for lifting during March 1-10, a tender document seen by Reuters shows. "We are also in talks with other suppliers in the Gulf like Kuwait, ADNOC and Saudi to get additional supplies under our term contract," an MRPL, source who did not wish to be named said. MRPL and Essar declined to comment on any government requests to cut purchases from Iran. IOC's finance head did not respond to phone calls. "India has cooperated with us in the enforcement of our sanctions regime, which continues to put a significant amount of pressure on the Iranian government and the economy," Rhodes said in the teleconference call. Last week, sources in India's oil ministry said India will also press the United States during Obama's visit to remove three Indian oil companies from a list naming firms doing business in Iran, and use the opportunity to seek priority access to U.S. LNG exports. The U.S. president will arrive in New Delhi on Jan. 25 and hold discussions with Prime Minister Narendra Modi, who visited Washington in September. (Reuters)
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India has asked its refiners to slash oil buys from Iran in the next two months to keep the imports in line with the previous fiscal year's levels, sources with knowledge of the matter said, days ahead of President Barack Obama's visit to New Delhi. India has raised its crude shipments from Iran around 40 per cent over the first nine months of the current fiscal year, when as part of the temporary deal that eased some sanctions on Tehran it was meant to hold them steady. India and the United States will discuss the status of the Iran nuclear negotiations, Ben Rhodes, deputy national security advisor in the White House told reporters in a tele-conference detailing Obama's visit. India's higher imports from Iran would also be on the agenda, the two sources in India said. "The refiners will have to virtually halt Iranian oil imports in February-March to retain purchases at last year's levels," said one of the sources with knowledge of the matter. The sources did not want to be named because of the sensitivity of the issue. India's imports from Iran rose 41 per cent to 250,200 bpd in April-December compared with the same period a year ago, according to tanker arrival data made available to Reuters. One of the sources said India's federal oil ministry told Essar Oil, Mangalore Refinery and Petrochemicals Ltd and Indian Oil, the only Indian companies that buy from Iran, to cut imports. Iran and six major world powers will meet next month to narrow differences over Tehran's nuclear programme after making limited progress earlier in January to clinch a full blown deal by June 30 deadline. MRPL and Essar declined to comment on any requests to cut purchases from Iran. IOC's finance head did not respond to phone calls.(Reuters)
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Come March, india Inc. will heave a collective sigh of relief. Twenty-three coal blocks are set to be auctioned, thus ending a stalemate that has lasted close to three years.
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Over the past year, India’s power sector has witnessed an unusual trend: a slew of deals to acquire distressed assets has fallen through at the last minute.
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The one thing finance minister Arun Jaitley does not have to worry about much in this budget is how to meet the fiscal deficit target of 4.1 per cent. Much of that work is being done outside of the country: the Organisation of Petroleum Exporting Countries (OPEC) has decided to not reduce crude oil production. In the process, global crude oil prices are tumbling by the day. In the 200-odd days that Narendra Modi has been in power, the India basket of crude has fallen by almost 60 per cent from $108.05 a barrel (on 26 May) to $43.36 a barrel (on 14 January).
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Opposing the government's airports privatisation plan, Airports Authority Employees Union (AAEU) has threatened to renew its agitation including a strike call if the move is not halted. The AAEU, in a letter to Civil Aviation Minister Ashok Gajapathi Raju recently, has also alleged that the decision to privatise the development, operations and management of four more airports - Chennai, Kolkata, Jaipur and Ahmedabad - violates the Tripartite Committee recommendations, which have already been accepted by the government long back. "If the government does not give us a proper hearing, we shall be constrained to take to recourse to industrial action and call for a general strike in AAI (Airports Authority of India)," the union said. The decision is detrimental to the interests of not only AAI employees but also air travelling public, it said. "The services provided at private airports come at a high price, as has been experienced with all the existing private airports where costs borne by the air travelers are much higher in comparison to the AAI-managed airports, where quality service is equally available at a much cheaper price," the union said. The fresh agitation threat by the AAI employees comes following the NDA government taking a U-turn on the airport privatisation policy. The erstwhile UPA government had proposed to privatise six airports - Chennai, Kolkata, Ahmedabad, Jaipur, Lucknow and Guwahati. In 2013, it had floated a global tender to give management contract for these airports. However, the move did not take off as the then government went into election mode. Taking the previous government agenda forward despite a stiff opposition from the AAI union, the new government had said it would privatise only Ahmedabad and Jaipur airports and not hand over Chennai and Kolkata airports to the private corporates as it has already invested public money to the tune of Rs around 5,000 crore in their modernisation and upgrade. The government, however, in a departure from earlier stand, early this month invited private domestic and overseas firms to operate, manage and develop the Chennai, Kolkata, Jaipur and Ahmedabad airports. But it left out Guwahati and Lucknow airports from the agenda as besides loss-making these airports also do not have enough volumes to attract private players. Even in the draft aviation policy announced last year, the government had stated that management contracts will be issued for the Kolkata and Chennai airports and the privatisation of Guwahati and Lucknow airports has been put on hold. Government's airport privatisation policy also came under criticism recently by the global airlines body, International Air Transport Association (IATA), which has often termed Indian airports as one of the most "expensive" ones. Observing that privatisation is not a "panacea" and does not solve all the problems, IATA Director general and chief executive Tony Tyler had said, "There are very successful airports run by Governments and private companies, while there are very expensive and inefficient airports too run by governments and private sector." (PTI)
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India will use an upcoming visit by Barack Obama to press the United States to remove Indian oil companies from a list naming firms doing business in Iran, and to seek priority access to U.S. LNG exports, sources in the Oil Ministry said. The U.S. president will arrive in New Delhi on Jan. 25 and hold discussions with Prime Minister Narendra Modi, who visited Washington in September. An official agenda has not been released. The U.S. Government Accountability Office (GAO) listed three Indian companies as having commercial activity in Iran's energy sector in a report this week, potentially making it difficult for them to do business with other countries, mainly the United States. Oil and Natural Gas Corp, Oil India Ltd, and Indian Oil Corp, which have been on the list since 2010, cited interests in Iran's Farsi concession in their 2013-14 annual reports but told the GAO they had ceased activity in 2007, the GAO said. "This (mention in the list) could hit Indian companies' plans to invest in other countries, particularly in America," said one of the sources. The United States has imposed sanctions on Iran's energy sector to put pressure on the Islamic republic to halt its nuclear programme, which the West suspects may seek to develop atomic weapons. Companies doing business in the sector face exclusion from the U.S. financial system. Iran says its nuclear programme is solely for peaceful purposes. Separately, Oil Ministry sources said India will seek preferential access to U.S. exports of liquefied natural gas (LNG), even though India does not have a free-trade agreement (FTA) with the United States. "We want them to give us the freedom to lift LNG from any of their projects on a priority basis, including the ones that are meant for FTA nations," an official said. State-owned gas firm GAIL (India) Ltd has an agreement to lift 6 million tonnes a year of LNG from two projects in the United States. U.S. oil and gas production has shot up in recent years as new technology has allowed the world's largest oil consumer to exploit reserves in shale formations. But exports are tightly restricted and LNG shipments must be approved by Washington. Exports of crude oil are banned outright, a legacy of the recent past when the United States consumed far more oil than it produced. Since taking office in May last year, Modi has pledged to improve the performance of India's power sector, which suffers from frequent blackouts, to fuel economic expansion. (Reuters)
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