Amid supply concerns, Indian crude basket rises 4% in July
New Delhi: The Indian crude oil basket which was largely subdued in May and June has witnessed over 4% increase in its average price in July amid global supply concerns. The average Indian crude basket for July stands at $78.22 per barrel, compared to $74.93 a barrel in June. In May, it averaged at $74.98 a barrel as prices eased amid growing concerns of a global slowdown.
According to the latest data on the site of Petroleum Planning and Analysis Cell (PPAC), the Indian crude basket stood at $79.33 per barrel on Monday, 17 July. According to analysts, the rise in the Indian crude basket has been due to recent uptrend in global prices on the back of supply concerns post announcements of additional output cuts by OPEC+ countries. In April, Saudi Arabia and other OPEC+ members announced additional oil output cuts of around 1.16 million barrels per day (bpd).
Further, in July Saudi Arabia announced Saudi Arabia and Russia announced further cuts. Saudi Arabia said it would extend its voluntary oil output cut of 1 million bpd for another month to include August, adding that the cut could be extended beyond that month. Russia also also announced that it would cut its oil exports by 500,000 bpd in August. The cuts announced this month amount to 1.5% of global supply and bring the total pledged by OPEC+ to 5.16 million bpd.
The rise in prices also come at a time when the discounts on Russian oil also have significantly declined, according to market experts. The discounts which stood at around $30 post Russia’s invasion of Ukraine, have now declined to single digits, according to people in the know. Russia emerged as the largest supplier of oil to India in FY23 with 50.84 million tonnes of crude supplies.
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