Indian oil companies are increasingly looking to snap up oil assets abroad amid India’s rising demand for crude.
Indian Oil, which is a state-run company, is planning to buy assets abroad which allow it to secure more of the crude that it uses for its refining activities from its own sources.
State-owned Indian oil companies, including ONGC and Indian Oil, have been spending billions of dollars to take stakes in Russian oilfields in Siberia as energy ties between the two nations have been strengthening.
“There is a lot of potential production from our existing blocks,” B Ashok, the chairman of Indian Oil told Bloomberg News this month, referring to the assets it already has in Africa, Latin America and the US. “We are also looking at economics and seeing where the assets are available. “There are lots of opportunities possibly on offer in Africa, Middle East and South East Asia. We are looking at these and if the prices are right, we will go for it.”
VK Vijaykumar, the chief investment strategist at Geojit BNP Paribas, said that investment overseas was key to India’s strategy to ensure energy security.
“India has been investing heavily in oil production both at home and abroad,” he said. “But there have been no major breakthroughs in domestic oil production.”
Arun Ghosh, a petroleum trading consultant based in Kolkata, said that “an escalation in crude oil price is breaking our country’s economic growth, which is painful. He added that Russia, as “India’s all-weather friend” was playing an important role in the country’s oil strategy.
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