Indian basket of oils at $55; producers meet on output cuts

Even as petrol prices in India breached levels last reached before the Narendra Modi goverment took charge in 2014, OPEC and non-OPEC ministers are meeting in Vienna on Friday to discuss extending their oil production cuts to further boost prices.

A panel of ministers from the 13-nation Organisation of the Petroleum Exporting Countries (OPEC) monitoring compliance on output cuts, which comprises Kuwait, Venezuela and Algeria, are meeting non-OPEC producers Russia and Oman at the OPEC headquarters in the Austrian capital.

In May, OPEC agreed to extend until March 2018 an oil output cut agreement put in place for six months effective from January 1 and which expired in June. Non-OPEC producers led by Russia also agreed to join the extension till next March.

Oil prices had earlier fallen by more than 50 per cent in less than two years due to a supply glut, from levels of over $120 a barrel.

Meanwhile, under the daily revision of fuel prices, petrol in Mumbai on Friday cost Rs 79.58 a litre, breaching levels it last touched in August 2014. It similarly costs Rs 70.47 in Delhi, Rs 73.21 in Kolkata and Rs 73.05 in Chennai.

Petroleum products do not come under the Goods and Services Tax (GST) and prices vary at locations according to state taxes.

Earlier this month, Petroleum Minister Dharmendra Pradhan said the dynamic pricing regime would continue despite petrol prices going up by over Rs 7 per litre since the scheme was introduced pan-India from mid-June.

The Indian basket of imported crude oils gained nearly $3.50 a barrel during last week.

The Indian basket, comprising 73 per cent sour-grade Dubai and Oman crudes, and the balance in sweet-grade Brent, has breached $55-mark and closed trade on Thursday at $55.51 for a barrel of 159 litres, which was higher than the previous day's close at $54.93.

The basket of OPEC crudes closed trade on Thursday at $54.59 a barrel, up from $54.06 of the previous day, the organisation's secretariat said.

Last week, Pradhan told reporters here that the government cannot change fuel prices on a knee-jerk basis after stocks of state-run oil marketing companies tanked by as much as eight per cent following recent hikes in transport fuel prices.

The Petroleum Minister said that while hurricanes Irma and Harvey had hit refinery production in Texas by as much as 13 per cent, he expected global crude prices to ease in the near future.

He said the international prices of petrol and diesel have recently gone up by 18 per cent and 20 per cent, respectively.

--IANS

bc/vm