NEW DELHI: Oil’s rally to $70 a barrel is threatening to clip India’seconomic wings at a time when Saudi Arabia is looking to join a $30 billionrefinery project in the world’s fastest growing market.
India wants to see prices at about $50 a barrel in order to manage itsfinances better, Oil Minister said in an interview.
Meanwhile, Saudi Arabia — which is said to be aiming for oil near $80 topay for its own crowded policy agenda — is planning to sign a deal toparticipate in a refinery on India’s west coast as part of its strategy tosecure sources of consumption for its crude.
While the Modi government reaped the benefits of the biggest price crash ina generation during its first term in power, oil is recovering as thegovernment gears up for elections in 2019.
Saudi Arabia, the world’s biggest crude exporter, is preparing for aninitial public offering of its state-run producer and leading effortsby OPEC to curb output and eliminate a global glut that spurred oil’sdecline.
“We are a very price-sensitive consumer,’’ Pradhan said on Tuesday. “FromIndian consumers’ point of view, I will be more than happy if the price isaround $50 a barrel.’’ Saudi Arabian Oil Co., known as Saudi Aramco, hasagreed in principle to join a proposed 1.2 million barrel a day refiner onIndia’s west coast, he added.