Shipping may impact oil markets in the short term but not supply as US plans to pump more crude: BPCL CMD

Crude oil shipments are likely to become an issue for international energy markets as the United States announces new sanctions on two Russian oil producers and several vessels, but as the United States plans to produce more oil under Donald Trump’s presidency, So this is unlikely to happen. This has a significant impact on oil supply and prices, said G. Krishnakumar, chairman and managing director of Bharat Petroleum Corporation (BPCL).

during an interview MintThe CMD said it does not expect oil prices to rise and may remain at a moderate level of $70-75 per barrel. He said that while shipping would be an issue in the short term due to sanctions, the situation should ease within a few months.

“It’s early days and we are assessing our situation. But there will be an impact. We are also waiting to see how OPEC+ reacts to this and whether they will reduce production and increase production. But a good sign is that, Because the US has said they will increase production and there will be no product shortages… transportation will be an issue due to sanctions and I think they should reassess and recover quickly,” Krishnakumar said.

“I don’t think we have to worry about high oil prices, I think it should be around $70-$75 (per barrel). We will see into March and then we will see how the sanctions are implemented,” he added.

The CMD of state-run OMC noted that crude supply was not an issue and said supplies from West Asia were making up for the shortfall in cargo from Russia.

ALSO READ | India needs more oil, may expand energy purchases from US: Puri

“There may be a shortage of 2-3 cargoes on the Russian side, but regardless, we are making arrangements from the Gulf and the Middle East, we are receiving crude oil. Our outlook for Russian crude oil supply is that it is an issue at some point in terms of Russian cargoes. Supply and demand will rebalance and there may be shortages of goods over the next month or two, but the market will definitely rebalance.”

He added that the company was also considering other options besides Gulf countries. Recently, the company has received oil from Argentina and is a regular buyer of U.S. crude.

Talking about talks on a long-term oil deal with Brazil, he said BPCL was looking for crude oil from the South American country but talks were still in the initial stages. Last June, Mint According to reports, state-owned oil marketing companies such as BPCL, Indian Oil Corporation (IOCL) and Hindustan Petroleum Corporation are in talks with Brazilian energy giant Petrobras to ensure long-term crude oil supply security.

Progress of Mozambique LNG Project strength force majeure As of April 2021, the company’s director (finance) Vetsa Ramakrishna Gupta said work on the project is likely to begin in April.

ALSO READ | Collateral damage: Indian refiners feel pressure from new US sanctions on Russian oil

“The new government has been sworn in and we have some indications that work could start in late March, May or early April. If that happens (work starts in April), we hope to start gas supply in FY28-29 ,” he said.

Three state-owned companies hold a 30% stake in the project operated by TotalEnergies. ONGC Videsh holds 16%, while BPCL subsidiaries BPRL Ventures Mozambique BV and Oil India Ltd hold 10% and 4% respectively.

CMD and Director (Finance) interviewed Mint after the company announced its October-December quarter results. BPCL on Tuesday reported third-quarter consolidated net profit growth of 19.6%, $3,805.94 Crores. In the same quarter of the previous financial year (FY24), the company reported a net profit of $3,181.42 Crores.

However, its operating income fell 1.9% $This quarter compared to the same period last year was $1.27 trillion. The profit increase came amid falling crude oil prices. The company attributed the financial results to efficiencies in its refining operations and marketing margins.

and read | RIL revives petrochemicals business with 12% net growth in Jio and retail sales