Russian crude, strategic reserves to cool oil prices

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New Delhi, February 27

The Government is making efforts to keep energy prices stable by planning to release its strategic petroleum reserves as well as green-lighting attempts by petroleum companies to snap up Russian oil that is ruling at a discount.

Brent crude had crossed $105 per dollar when Russia invaded Ukraine and while it has slumped somewhat, the high levels still pose a threat to India's macro-economic stability.

Indian companies are reported to have contacted for 6 million tonnes of Russian Black Sea crude with Indian Oil Corp buying Russian Urals crude for the first time after 2020. The companies are now reportedly in the hunt for crude that Russian usually sells to Europe but which may be looking for customers.

The Black Sea crude from Russian Urals and Kazakhstan is still passing unhindered through the Straits of Bosporus controlled by Turkey which, however, is denying transit to Russian naval ships. Some of this crude is also taken by South Korea and Japan.

India is also planning to release some of its crude reserves next month if global crude prices continue to remain high. The move may be made in coordination with the US which also plans to release some of its strategic reserves to lower domestic pump prices and bring inflation under check. "With a view to ensuring energy justice for its citizens and for just energy transition towards a net zero future, India stands ready to take appropriate action for ensuring ongoing supplies at stable prices," said an official statement.

"India is also committed to supporting initiatives for releases from Strategic Petroleum Reserves, for mitigating market volatility and calming the rise in crude oil prices," it added.

The Tribune