Saudi Oil Minister Prince Abdulaziz bin Salman on Thursday assured his Indian counterpart Dharmendra Pradhan of meeting all oil supply commitments to India as the Kingdom looks to restore production from its facilities to pre-strike levels very soon.
Saudi Oil Minister Prince Abdulaziz bin Salman on Thursday assured his Indian counterpart Dharmendra Pradhan of meeting all oil supply commitments to India as the Kingdom looks to restore production from its facilities to pre-strike levels very soon. Pradhan spoke to his Saudi counterpart on phone and discussed in details supply plan in the aftermath of a massive attack on the Kingdom’s crude oil facilities that wiped out as much as 5 million barrels per day of output. “They have again assured that all supply commitments to India will be met,” said Sanjiv Singh, chairman of Indian Oil Corp (IOC).
Saudi Arabia, which is India’s second-largest oil supplier, sells close to 2 million tonnes of crude every month. Of this, 1.2-1.3 million tonnes of supplies for September have already been taken and the rest too has been assured. However, Saudi has sought deferment of some LPG supplies but they have assured to make up for all the quantities, he said, adding any shortfall can be bought from Qatar.
India buys some 200,000 tonnes of LPG every month from Saudi Arabia. Industry sources said Saudi Arabia has cut throughput at its refineries to meet its crude oil supply commitments. Pradhan had earlier this week stated that India, the world’s third-largest oil consumer, is keeping a close watch on the developing situation. Indian oil companies, as well as the government, are in touch with Saudi oil company Aramco and authorities in the Kingdom, he had said. “India is watching the situation closely.”
India imports 83 per cent of its oil needs, with Saudi Arabia supplying a fifth of the purchases. Saudi Arabia is its second-biggest supplier after Iraq. It sold 40.33 million tonnes of crude oil to India in 2018-19 fiscal, when the country had imported 207.3 million tonnes of oil. A massive drone strike on the world’s largest crude-processing facility operated by Saudi Aramco on Saturday drove oil prices to their highest level in nearly four months.
The attack had knocked out over half of Saudi Arabia’s production as it cut 5.7 million barrels per day or over 5 per cent of the world’s supply. Abqaiq and Khurais are main processing centres for Saudi Arabia’s Arab Extra Light and Arab Light crude oil. China, South Korea, Japan and India are the biggest takers of the Saudi oil in Asia, with China and Japan leading the pack at an average of 900-1,100 kilo barrels per day each. India could be most exposed as its reserves are the lowest.