Pradhan speaks to Saudi minister, says oil prices must be kept low

The ministers spoke to each other amidst reports about a possible tie up in the petrochemical and oil refinery sectors between Saudi Aramco, the world's largest oil exporter, and RIL

Petroleum minister Dharmendra Pradhan urged Saudi Arabia to help keep oil prices low when he spoke to the kingdom's energy minister, Khalid Al-Falih, on Friday about investments in India's energy sector.

The ministers spoke to each other over phone amidst reports about a possible tie up in the petrochemical and oil refinery sectors between Saudi Aramco, the world’s largest oil exporter, and Mukesh Ambani-led Reliance Industries (RIL). The RIL tie-up will be in addition to the $44-billion Ratnagiri refinery in Maharashtra, for which Saudi Aramco and UAE’s Adnoc are partnering with Indian Oil Corporation, Bharat Petroleum Corporation, and Hindustan Petroleum Corporation.

The ministers discussed the recent geo-political developments impacting crude oil prices. Pradhan, while referring to the developments in the Strait of Hormuz, conveyed his concern on rising crude oil prices. He also reiterated the sensitivity of Indian consumers to prevailing crude oil price volatility. He sought Saudi Arabia's role in the OPEC and in the OPEC Plus discussions for keeping oil prices low.

According to an official, the ministers reviewed the progress of Saudi investments in India’s refining and petrochemical sectors. They agreed to expedite the implementation of various initiatives to transform the hydrocarbon engagement from a buyer-seller one into a comprehensive one.

Saudi Oil Minister Khalid al-Falih and RIL Chairman Mukesh Ambani last year in a meeting discussed opportunities for joint investment and cooperation in petrochemical, refining and communication projects. RIL operates two refineries at Jamnagar with a combined annual capacity of 68.2 million tonne. It is also the largest telecommunication service provider in India. Saudi had also expressed interest in investing in India's fuel retail sector last year. 

On the other hand, the Ratnagiri refinery, in which Indian companies have 50 per cent ownership had run into problems with Maharashtra chief minister Devendra Fadnavis announcing relocation of the site.