Is India being forced to buy expensive crude oil due to pressure from the U.S.? In this exclusive discussion, OneIndia’s Nagen Singh speaks with Ravi Srivastava, former Chief Manager of HPCL, to break down how Donald Trump’s policies are impacting India’s energy sector. Are rising oil prices a result of strategic arm-twisting by the U.S.? Watch this in-depth analysis to find out! DONALD TRUMP
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#IndiaOilCrisis #TrumpModi #CrudeOilPrices #Geopolitics #OneIndiaExclusive #NagenSingh #RaviSrivastava #HPCL #EnergyCrisis #BreakingNews
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00:00I had said that the kind of crude oil we are buying, India can easily sell petrol at 55
00:07to 60 rupees per litre.
00:09Mr. Modi could not extract an invitation for attending the coronation ceremony of United
00:15States President Donald Trump.
00:16With this pressure from US, India will be forced to buy an expensive crude oil.
00:23It's only the media which is trying to prop up the image of Mr. Modi by showing that somebody
00:28shook hands and somebody hugged and somebody offered a chair, etc.
00:33In this country, the normalization is all under pressure.
00:38We continue to call we are the fifth largest economy, etc.
00:42But we have a per capita less than the Bangladesh and the Somalia.
00:46We have with us Mr. Ravi Srivastava.
00:49He has been general manager of HPCL.
00:53And Mr. Srivastava, we do know that Narendra Modi announced that US will become the biggest
01:03partner of India in terms of crude oil.
01:08So what does it mean and what does really changes for India?
01:13How India was importing oil earlier and what has changed for India after this decision?
01:20I would not call it a partnership, but I would call it a kind of selling the country's
01:27interest under duress to the United States.
01:33Since the USSR and Ukraine war had started, India was buying crude from Russia and Iran,
01:44Middle East.
01:45India was getting at a far cheaper rate as compared to prevailing international prices,
01:51almost to the extent of 30 to 40 percent cheaper per barrel than compared to the international
01:58markets.
01:59In India, we have got abundant of refining capacity.
02:04We have got new refineries available, Reliance Group refineries are available, HMEL is there,
02:16Mysore capacity has been expanded, we have got Kachin refinery and Chennai refinery also.
02:22So we have got a lot of capacity for refining the crude.
02:26And this crude refined, Reliance was selling at a premium, the refined product to the European
02:33countries and making reasonably good profits.
02:37Now with this pressure from the US, India will be forced to buy an expensive crude oil.
02:45An expensive crude oil will definitely drain India's foreign exchange because 88 percent
02:54of India's need is imported crude.
02:58We hardly have got that 12 percent production.
03:01So you are saying that it is not a good deal for India, logistically also it is a big challenge
03:06for India, bringing oil from other parts of the world all together.
03:11Definitely because earlier US did not have so much of crude oil as well, but with the
03:18Trump administration now coming up, they have decided to increase their production and increase
03:25it substantially and they will be having the crude available to export.
03:31So that's why, that's the reason they are forcing India to buy it.
03:35You have rightly said it, it's logistically a disadvantage because such a long distance,
03:40while India is getting crude from Russia, very convenient, and from Middle East, which
03:46is also very nearby.
03:50But then why a country such as India, it has its own, you know, presence, we are someone
03:56who claim to be one of the strongest nations, fifth biggest economy, then why so much of
04:03pressure or why, what you are saying, it is quite direct, that India is buying this
04:09oil under pressure, because we are already getting cheaper oil from Russia.
04:13First of all, India's need is constantly rising, despite so much of use of renewable energies,
04:20like solar, wind, or electric, still the production of the automobiles, which is exponentially
04:29increasing.
04:30So there is the need for fossil fuels, that is motor fuels, petrol, diesel, LPG, etc.,
04:37etc.
04:3810 or 15 years before, we were almost at the stage of 84% of our need was dependent upon
04:47the foreign crude, which of late has now become 88%.
04:53Since we have not invested adequately in the exploration, and we have our fields are
05:00getting aged, whether it is Cauvery Basin, or whether it is Bombay High, their yield
05:07is constantly reducing, and we are not investing enough to increase it, to augment it.
05:16That's the reason that our dependence on the imported crude is constantly rising.
05:20And since we were getting a crude which is at much lower price, India was able to sustain
05:26very well, because their foreign exchange outgo was limited.
05:30But now with this pressure, the economy would definitely suffer, foreign exchange will be
05:36under pressure, because we'll have to buy the expensive crude oil from the US.
05:41How do you see all this changing, you know, the relations in terms, the relations with
05:47Russia?
05:48Because we, we do know that how close partners, India and Russia have been whether it's crude
05:55oil or the arms and weapons.
05:59And all in all these terms, now Trump wants India to deal with USA.
06:05So it will be a big setback for a country like Russia for Putin.
06:09Till 1970, or I must say till 1980, India and USSR were very good friends, very close
06:16friends.
06:17And there was a lot of, because Russia came out of the communist rule, and the factories
06:25which were manufacturing the arms, they started manufacturing the toys ultimately.
06:30So their economy changed altogether overnight.
06:35And India and USSR were very good friends.
06:38And this friendship revived recently.
06:40In between there was a setback, because of the American pressure on India.
06:45It was, it was, you know, the since it's a, you know, political balancing, India was more
06:52inclined towards the US, US and the friendship with USSR was affected.
06:57But after Corona, the way we started getting the cheaper crude oil and then friendship
07:03again increased, I think the US does not see it rightly.
07:09They feel that their economy is under, you know, they are, their resources are being
07:14drained.
07:15This is what they feel.
07:16So it is not only in the oil, the entire tariff, the US, US has indicated that they should
07:23be at par and India, Mr. Donald Trump has called India even a tax or tariff abuser.
07:30So that's the situation today.
07:32And this will definitely have a reasonable setback on Indian economy.
07:39It's not a win-win situation, if someone says, mostly many of the, you know, mainstream channels
07:47telling it's a big win for India, India buying F-35 and this crude oil supply.
07:52So overall, it's not a big win-win situation.
07:55It is more of a compromise for India to sell its products in USA.
08:00And of course, vice versa, that US could sell its product on much, you know, lower tariffs
08:06in India.
08:07Unfortunately, Mr. Modi could not extract an invitation for attending the coronation
08:12ceremony of United States President Donald Trump.
08:16And it was, it was set, made to be an opportunity of the two national heads to meet one to one.
08:25But the entire visit of Mr. Narendra Modi to US, I feel it's a, it's only a show off and
08:33nothing else.
08:35There is nothing achieved as far as, no tangible achievements by India.
08:41As far as F-35 are concerned, Mr. Elon Musk's statements are there on record, who said these
08:46are the almost flying coffees, many, many accidents have taken place, and the plane
08:52is very expensive, it was almost a scrap, nobody's willing to buy that and forced India
08:59to buy it.
09:00So that is one.
09:01On tariff part, you have seen it, on oil, you have seen it, on immigrants, you have
09:04seen it.
09:05So in nutshell, it's only the media which is trying to prop up the image of Mr. Modi
09:10by showing that somebody shook hands and somebody hugged and somebody offered a chair, etc.
09:16Or somebody said you are a great Prime Minister, this is all optics, there is there is nothing
09:22tangible gain for India as such.
09:25If you watch one meeting of Prime Minister Modi with Mr. Elon Musk, in which all India's
09:31top brass was sitting on a side like NIA head, NSA head and ambassador and everyone.
09:37On the other side, Mr. Elon Musk sitting with his girlfriend and the two children and nanny.
09:42So I mean, what kind of bilateral discussions were there?
09:45And what has been achieved?
09:47I think the questions asked during the press conference, impromptu press conference, which
09:53America as a democracy does it necessarily, they never bypass it.
09:58They did it on which Mr. Adani's question was asked by one reporter, and Mr. Modi was
10:03flabbergasted.
10:04He was he was looking totally uncomfortable before the audience.
10:09There was one question on which Mr. Trump said that Mr. Prime Minister, I will answer
10:15this question.
10:16It was on Biden administration.
10:17So such was the situation.
10:19You have headed HPCL in a way and you know in and out of the entire system.
10:24We want to ask you, India never thought that or the Indians never thought that we'll be
10:29buying petrol for 100 plus rupees.
10:33It was never in the picture.
10:34It happened and now it has been normalized.
10:37What should we be ready for after the US oil coming in on a much higher rate?
10:44In this country, the normalization is all under pressure because the is available for
10:53250 rupees per kg and I have to buy at least one or two kg every month.
10:58I will go and buy it.
11:00The same stand for the petrol.
11:02It's for survival.
11:03One has to go to his work, one has to do his daily course.
11:07So he is forced to buy it.
11:09People are.
11:10But what's the new number that we should think of?
11:11It used to be something as a mark that we it will never cross 100, but it is it has
11:16happened.
11:17100 was a 100 was a coercion on the people.
11:22I'm telling you, I'm opposing it.
11:24The day it was introduced, I had said that the kind of crude oil we are buying, India
11:30can easily sell petrol at 55 to 60 rupees per liter and the diesel at 50 rupees per
11:36liter.
11:37We don't require so much of taxation on this or excise duty on this.
11:42The excise duty, which was 9 rupees per liter, was made 33 rupees per liter.
11:47You can imagine yourself that where it will take the price and all in the name of because
11:52we are going to bring the infrastructure, we are going to do this.
11:55We are going to do that and we will extract the people of the nation with a very high
12:00exorbitant fuel price.
12:03So Indians must be ready for more expensive oil, more expensive petrol.
12:11If that happens, ultimately it will affect the sale of the automobiles only because people
12:16are already shifting from fossil fuel to the electric vehicles to LPG vehicles to CNG vehicles.
12:27This is India's push towards green energy by making the petrol expensive.
12:33Right.
12:34Right.
12:35Right.
12:36Right.
12:37And there's a good, it's a good thing.
12:38It is not happening in India alone.
12:39This is happening worldwide.
12:40Yeah.
12:41It is happening worldwide.
12:42All top automobile manufacturers have, you know, shifted their production from the fossil
12:47fuel to the eco-friendly fuels or for that matter, to the electric vehicles and even
12:54the solar driven vehicles, all such things.
12:58All automobile manufacturers are doing it.
13:00It is not in India alone.
13:02Okay.
13:03Mr. Sebastian, last question, I just want to understand three to four points that you
13:08see out of this, you know, the new deal that India has done with USA, especially in terms
13:15of crude oil, just three, four points, not the description, but just three, four points,
13:21which can be positive, negative, but how do you, you know, see it just three, four main
13:25points of this entire new deal.
13:28The only positive which I see out of this is that some ice has broken between Mr. Donald
13:33Trump and Mr. Narendra Modi, which was, you know, which was multiplying and which was
13:38creating a lot of confusion.
13:39So it is at least they both have come on one table, although Mr. Trump said that you are
13:45a very strong negotiator, et cetera, within the process, he proved to be a bigger negotiator
13:50and he pushed Mr. Modi to the brink.
13:53Another thing is, I would say that the markets would definitely suffer already, FII, FII
13:58when we call it, it is 99% FII from the US only.
14:03So they have already withdrawn three lakh crore worth of money from Indian markets since
14:0828th of September when it was at the peak.
14:11So three lakh crore worth of money has gone, the market has sunk 10,000 points down, rupee
14:16has sunk, rupee has gone to 86, 88 paisa and almost 10% since last four, five months.
14:24So this is, this is the status.
14:27I would say that the economy is trying to find its place now.
14:31This is, we are, we continue to call we are the fifth largest economy, et cetera, but
14:36we have a per capita less than the Bangladesh and the Somalia.
14:39So I think that has got no meaning unless the standards of the bottom most people rise
14:45up, which we call the elevation of poverty.
14:48So this is not happening.
14:49The gap is rising substantially and this is definitely leading to more, you know, unrest
14:56among the people.
14:57Thank you so much, sir.
14:58Thank you so much for your time.
15:00You are someone who knows in and out how, you know, the petroleum system works in India,
15:07which is very difficult for many of the journalists who are not covering it regularly.
15:12So thank you so much for your insight.
15:14And we just hope that we have a much cheaper oil or crude oil coming in into India so that
15:21our pockets will be paying less for everything.
15:24Thank you so much.
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