Oil price rise may raise import bill to $16 bn

However, when contacted by The Indian Express, Minister of Petroleum Ram Naik declined to comment on the recent development stating that the matter would come up for discussion in the Parliament tomorrow.

Among other issues discussed in today’s meeting, the petroleum ministry took serious note of the continuing decline in Oil and Natural Gas Corporation (ONGC)’s production figures.

ONGC’s production has declined from 28.685 million tonnes in 1996-97 to 24.648 million tonnes in 1999-00. The target for the year 2000-01 is at 24.648 million tonnes, which is the amount of production it had achieved in the previous year. However, according to sources in ONGC, actual production for the year 2000-01 is likely to be below the target figures by well over a million tonnes. So far, however, ONGC has kept to its target and till July 30, 2000, had achieved a production level of 8.25 million tonne.

On Tuesday, global oil prices had peaked on fears of a fall in US stockpiles and also due to an OPEC statement that member countries needed revenue from oil exports to boost their economies. Brent crude then raced to $32.75 a barrel, the highest in a decade. The previous peak was that of $31.95 in March.

However, on Wednesday, Brent Crude on US stocks slipped marginally during early trading. Brent Crude for September delivery was trading at $31.95 a barrel, which is 23 per cent lower than the previous day closing.

In New York on Tuesday, light sweet crude for September delivery ended the session at 31.67 dollars a barrel, 27 cents lower. Prices surged in London and New York on Tuesday to well over 32 dollars a barrel before publication of figures by the American Petroleum Institute (API), amid expectations the body would reveal a continuing decline in stock levels.

However, the API said late on Tuesday that crude stocks had risen 7.40 million barrels to 286.4 million in the week to August 11 from the previous week. Crude stocks were 32.76 million barrels lower from the previous year. Gasoline (petrol) stocks fell 3.34 million barrels to 202.51 million over the week and declined by 4.51 million barrels from the year earlier. Distillate fuel stocks rose by 1.88 million barrels to 113.23 million on the week and fell 25.51 million barrels from the year before.