Brent crude is up 22% this year to almost $95 a barrel.
India’s oil minister said higher crude prices would only serve to accelerate the transition to cleaner energy and worsen any global recession.
“If you raise the price from here, the only response is that the recession will be deeper and prolonged,” Hardeep Singh Puri said to Bloomberg TV at the Adipec energy conference in Abu Dhabi. “It’s in their interest not to let it go beyond” current levels, he said, referring to producers.
India is one of the world’s biggest crude importers and a major buyer from Persian Gulf countries such as the United Arab Emirates, Saudi Arabia and Iraq. Unlike the US, it has not publicly criticized this month’s decision by the OPEC+ cartel to lower output from November.
Unintended Consequences
Brent crude is up 22% this year to almost $95 a barrel. The market has been roiled by Russia’s invasion of Ukraine and the subsequent Western sanctions on Moscow.
“This is a game in which you don’t need to get unduly concerned,” said Puri, who was earlier on a panel with his Saudi and Emirati counterparts. “These are sovereign decisions. Anyone who’s a producer has the right to decide what to produce or sell. But we also tell them, and I’ve missed no opportunity to point out, that every action has consequences, both intended and unintended.”
One unintended consequence, he said, is that “billions of dollars” are being invested in electric vehicles and lithium, a key component of EV batteries.
“There are fascinating things happening,” he said. “We will benefit from that. We will not allow shortages of energy. If there’s a problem with one source, we’ll go to another source.”
India will examine any G-7 price-cap on Russian oil, Puri said, without giving more detail. Most analysts expect India and China — which have increased purchases of Russian crude since the Ukrainian invasion — to ignore a US proposal to limit what buyers pay for flows from Moscow. Both New Delhi and Beijing already import much of the oil they get from Russia at a steep discount.
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