Pradhan hints at new gas policy, says low oil prices no answer

With current pricing formula making natural gas production economically unviable, Oil Minister Dharmendra Pradhan on Friday hinted at bringing in a new gas policy as well as launching a gas exchange very soon as part of reforms to promote greater use of environment-friendly fuel in the world's third-largest energy-consuming nation.

Pradhan also said that India favours reasonable prices that give some space to the producer countries.

"We have to have a reasonable price. India is a major consumer. But at this juncture, India's viewpoint is the price should be reasonable and responsible. Very low prices are not the answer. Reasonable prices are the answer," he said.

Speaking in the latest edition of the CERAWeek Conversations series, he said, "Oil prices should give some space to the producer countries. It should be profitable for them; it should be viable for them."
On longer-term energy policy priorities following national lockdowns, he said, "We are moving towards a new gas policy, a new tariff policy. We are planning for a gas exchange very soon and we will be liberalising our distribution mechanisms."
"India has 5.3 million tonnes of strategic storage capacity. By mid-May it will be full," he said. "Apart from that our companies have 7 million tonnes of floating oil in their contracts. We have booked them, we have purchased them."