CCEA to consider reform proposal for domestically produced oil

Representative image (Source: Reuters)

The Cabinet Committee on Economic Affairs (CCEA) has said that it is likely to consider the proposal to reform domestically produced crude oil, in a video conference on June 29.

The CCEA, led by Prime Minister Narendra Modi, is expected to take up the proposal to ease the regulation for domestically produced oil. If accepted, it will allow crude oil producing companies to sell crude oil in the open market, as reported by CNBC Aawaz.

The proposal is aimed at increasing  the domestic production of crude oil in the country.

The outcomes of the meeting are likely to be announced by Thursday, June 30, by Union minister Anurag Singh Thakur.

India’s domestic crude oil production has been on a consistent decline since FY15. In FY22, the country produced only 28.4 million tonnes (MT) of crude oil, which is the lowest in nearly three decades, since FY94, as per reports. The government, thus, looks to increase the production of domestic crude oil.

From 35.7 million tonnes in 2017-18, it fell to 34.2 million tonnes in the following year and 32.2 in 2019-20, and 30.5 million tonnes in 2020-21. The crude oil production in FY22 was 11.67 per cent below the target of 33.61 million tonnes, according to official data released by the oil ministry.

Ageing fields in the country where natural production decline has set in, has contributed to the decline in overall production of domestic crude oil. 

If the government approves the reform in the regulation of domestically produced crude oil at the CCEA meet, the chances of increasing the same will be more.