Davos 2025: India Open To Buy More Energy From US, Says Indian Oil Chairman
India's economy and energy market would take the potential effects of sanctions on Russia—a prominent trade partner for supply of oil—'very robustly', Arvinder Singh Sahney said.
Government of India has shown inclination that it is willing and open to more energy purchases from US. This opens up a very wide bouquet of sources, so energy security is taken care of, said Indian Oil Ltd.'s Chairman, Arvinder Singh Sahney.
In conversation with NDTV Profit at the World Economic Forum in Davos, Sahney spoke about the impact of Donald Trump's second tenure as president of the US and how the country's potential sanctions on Russia would affect the energy market in India.
India's economy and energy market would take the potential effects of sanctions on Russia—a prominent trade partner for supply of oil—"very robustly", he said.
Sahney attributed this to the diversified sources of energy that India has, such as Organization Of Petroleum Exporting Countries, gulf countries and others.
Effects would be present, but they would be marginal and contained due to this diversification, he said. The Indian Oil Chairman estimates prices of Brent Crude could hit $75-80 per barrel within six months to one year.
He is bullish that once the US starts drilling more for oil, there will be a lot of gas available in the global market by 2026-2027.
He mentioned the target of increasing national gas reserves from 6% to 16% given by Prime Minister Narendra Modi.
"Today, 32 crore connections have already been given to the oil industry," Sahney said.
There is a tightrope walk between expansion and a steady balance sheet, he said. All the players in the Indian oil and gas industry need to share the responsibility of bringing down the cost of placing LPG at the customer's doorstep.
Indian Oil's Expansion Plans
By October-November, more than 18% of all motor spirit, including the contributions of all oil marketing companies, will be sourced from farmers, according to the top executive. This will result in a cumulative financial benefit of no less than Rs 90,000 crore being directed back to farmers, through the purchase of raw materials by distilleries and processors involved in the production of biogas and ethanol.
Indian Oil's refining capacity will increase to 20-25% in three to five years. The company has already executed projects worth Rs 1 lakh crore, Sahney said.
The company plans to invest Rs 90,000 to Rs 1 lakh crore to take place in the next five to seven years. Petrochemical capacity will be four times the current amount by 2030, he projected.
All of this expansion will take place on the back of renewable energy. Hardcore renewables have a target of going up to 30 GW, Sahney said.
Indian Oil has plans to set up the biggest plant in India for green Hydrogen worth 10,000 tonnes per annum in Panipat, he said.
