Macro Economy

HPCL chair says ‘high’ crude prices could weigh on fuel demand

Reuters New Delhi | Updated on October 21, 2021

Indian refiners were working to trim import costs with jointly negotiated contracts

The chairman of Hindustan Petroleum Corp Ltd (HPCL), Mukesh Surana, said the current ‘high’ crude oil prices could lead to demand destruction in the long run.

Surana said $60–70 per barrel was a comfortable range for refiners in India, the world’s third biggest oil consumer which imports about 85 per cent of its oil needs.

Oil futures have been trading near multi-year highs due to a global energy supply crunch, with the Brent crude benchmark at $84.30 a barrel on Wednesday.

Also see: Oil extends gains as US crude inventory tightens, pointing to strong demand

Surana said Indian refiners were working to trim import costs, with jointly negotiated contracts allowing for better terms one of the strategies under discussion. India is looking to bring together State-run and private refiners to seek better crude import deals, Oil Secretary Tarun Kapoor told Reuters on Tuesday.

HPCL has restarted the fire-hit crude unit at its Visakhapatnam refinery, Sunara said, adding that the group’s three refineries were running at an average 100 per cent capacity.

Published on October 21, 2021

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