New Delhi: India Thursday expressed concern over developments in the Strait of Hormuz impacting movement of crude oil and LNG tankers, and sought the world’s top oil exporter Saudi Arabia’s active role in keeping rates at reasonable levels.
Saudi Energy Minister Khalid al-Falih made a brief visit to India and then flew to China as the OPEC kingpin tried to get the top oil buyers involved in securing ships through the narrow strait that links oil producers to the rest of the world.
The move follows heightened tensions after the Iranian Revolutionary Guards seized British-flagged oil tanker Stena Impero in the waterway last week in an apparent retaliation for the British capture of an Iranian tanker two weeks earlier.
“Met Saudi Energy Minister, H.E. @Khalid_AlFalih & discussed the ongoing developments in the global oil markets,” Oil Minister Dharmendra Pradhan tweeted after an hour-long lunch meeting with the visiting minister.
“Raised my concerns on the recent increase in Asian Premium, disturbances in the Strait of Hormuz impacting the movement of oil/LNG tankers and the decision of OPEC Plus members on extending production cuts leading to oil price volatility & its adverse impact on the Indian economy.”
India faces the biggest impact of the current tensions in the Strait of Hormuz as it depends heavily on the region for its oil and gas supplies. Two-thirds of the oil and half the liquefied natural gas (LNG) India imports come from the strait between Iran and Oman.
Eighteen million barrels of oil pass through the Strait of Hormuz every day, accounting for one-third of the global oil trade. Besides, one-third of the world’s LNG trade also passes through the strait.
On June 13, two oil tankers in the strait were damaged by explosions, an attack which the US blamed on Iran. Iran has denied any involvement. The attacks were seen by some as a response to the US tightening its sanctions on Iran.
Since then, Indian ships passing through there have taken the assistance of the Indian Navy escort to safely pass through the waterway.
