Oil Minister Puri flags supply, price stability as key energy challenges for 2025

Minister of Petroleum and Natural Gas Hardeep Singh Puri

Adequate availability of energy and stable prices amid geopolitical tensions are seen as the major energy challenges for 2025, Minister of Petroleum and Natural Gas Hardeep Singh Puri told Moneycontrol in an interview.

But the world is moving towards peace, which is a big positive for the energy markets, Puri added on the sidelines of India Energy Week (IEW) 2025.

The third edition of IEW, organised by the Ministry of Petroleum and Natural Gas (MoPNG), was held in Delhi from February 11-14.

Edited excerpts:

You had expected IEW to set the tone for the global energy dialogue of 2025. How have your discussions with world energy leaders been?

I said that because this is the first major platform of the year. What is the energy challenge this year — it is making sure that enough energy is available, that prices do not skyrocket due to geopolitical tensions, that commitments people have made in different forums, including on transition, are met, and that all the players in the ecosystem, like startups, are encouraged.

The good news is that prior to this meeting itself there was a clear move towards (geopolitical) reconciliation. I saw the first sign of that when issues around the Israeli ceasefire were discussed. The movement is in the direction of peace. Then there are statements coming in that we want more oil and gas in the international market, and there is more oil and gas coming from the West.

For energy markets, this is very good. If there is geopolitical tension, then your supply routes get changed, insurance rates go up, freight rates go up, there's economic disruption. So, I'm glad this meeting is taking place at the beginning of the year.

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India's energy relations with other countries are changing. How do you see India benefitting from this?

It's not just changing, a fundamental transformation is taking place. By fundamental transformation I mean we used to import from 27 countries till a few years ago. Today we import from 40. One of our companies just bought a million barrels (of crude oil) from Argentina. We are exploring more avenues; we are ramping up the exploration and production.

Today, foreign companies are bidding along with our OMCs (oil marketing companies) and private sector players in the Andaman islands. There's a joint bid between ONGC, Reliance, and BP. Petrobras is helping in the seismic survey of the Andaman basin along with OIL (Oil India Limited).

What kind of relationship do you foresee with the US going forward? Do you see more offtake of US energy?

It's a very strong bipartisan relationship between India and the US. The India account is supported by both Democrats and Republicans. You must note that the Prime Minister has an old and special relationship with President Trump. So, going forward, I think we can hope for good things.

We could well see more offtake of US energy, but it's not for me to speculate till the discussions take place and the commercial arrangements are arrived at. By the way, we are buying $20 billion of energy already from the US.

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How have your interactions with Russia been vis a vis the US sanctions?

Some Russian entities were sanctioned, but Russian oil was not. My understanding is that there was a (US mandated)  price cap and we complied with it. We are a responsible international player. We'll see how it goes. If we all work towards peace, then I think some of these stress points will ease, and more and more energy will ve available.

The International Energy Agency (IEA) has said that India’s gas demand will rise 60 percent by 2030. What is your assessment of India’s gas economy in the coming five years?

We are committed to increase the share of  gas  in India’s total energy basket from 6  to 15 percent by 2030. We are closer to 6 percent than 15 because there are challenges . Also, you're talking about percentage on a growing base. For example, if your consumption (of crude) increases from 5 million barrels per day to 5.5 million bpd, then your consumption is also rising. After 2027, if more gas is available in the world (per expectations), we will benefit from that.

There was an expectation that the budget would compensate OMCs for LPG under-recovery . What is the situation there?

OMCs are good corporate citizens. If the government decides that LPG cylinders under the Ujjawala scheme will be sold for Rs 500, there would be under-recovery. Last time (October '22), the government gave a compensation of Rs 22,000 crore for under-recoveries of Rs 28,000 crore incurred by OMCs. If they have under-recoveries, we will compensate them this time as well.

How do you see India emerging as an energy player? Are we looking at deeper discounts from suppliers?

We are already a major energy player and will become even more so. We are the third-largest consumer, the third-largest importer, and the fourth-largest refiner.

Our entire oil import policy, energy import policy is based on discounts. If I am getting cheaper crude (from a country), why would I buy from an expensive source? They would compete among themselves. We will float tenders and buy from the cheapest supplier.

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