Now, people talking about oil moving in $65-100 range: MK Surana, HPCL
As far as India is concerned, any increase in prices does hurt the Indian economy. We will always prefer that it should be
lower, MK Surana, CMD, HPCL, tells ET Now.
Edited excerpts:
Is there any update on the HPCL MRPL merger?
No, not immediately but we are working on it along with ONGC and MRPL and as I mentioned earlier also, we need to take it to all the three boards and then we will come with the exact details. We are working on it, All of us think that is the right thing to do but we need to work out the full details.
With price absorption and price freeze before the elections, do you feel a burden of subsidy may also come along?
It has been clarified by the honourable minister and the officials also that the deregulation of petrol and diesel prices continue and there is no thought as of today to bring back the subsidy regime. Of course, in the recent past, a temporary intervention was made by the government to ask OMCs to absorb Re 1 per litre and MS and HSD but that may be based on day-to-day international prices the domestic prices of petrol and diesel are being varied in line with that. That should give some confidence to the people that the daily pricing mechanism determined by the market is in place.
While OPEC says the market is well supplied, Iran and Venezuela with production being affected might also be affected. Would it impact India in the short to medium term?
The oil scenario right now in the recent past has done ups and downs. It almost went up to $86 then reversed back to $80. Right now, it is hovering at $81. There were a lot of speculations also and there is a lot of uncertainty which people have factored in with regard to trade wars, the exact contours of the sanctions on Iranian barrels, whether Iranian barrels will be completely out of the market etc.
So some of that uncertainty is building and speculative positions unwinding. Some time back, it was always $80 plus scenario but that narration is changing. Now people are talking of a wider range from $65 to $100. So, both lower and higher side are there. Yesterday, I heard some people saying that the long-term view may be $60 to $70. So, it is looking more towards $80 than $90 now. As far as India is concerned, any increase in prices does hurt the Indian economy. We will always prefer that it should be lower.
Edited excerpts:
Is there any update on the HPCL MRPL merger?
No, not immediately but we are working on it along with ONGC and MRPL and as I mentioned earlier also, we need to take it to all the three boards and then we will come with the exact details. We are working on it, All of us think that is the right thing to do but we need to work out the full details.
With price absorption and price freeze before the elections, do you feel a burden of subsidy may also come along?
It has been clarified by the honourable minister and the officials also that the deregulation of petrol and diesel prices continue and there is no thought as of today to bring back the subsidy regime. Of course, in the recent past, a temporary intervention was made by the government to ask OMCs to absorb Re 1 per litre and MS and HSD but that may be based on day-to-day international prices the domestic prices of petrol and diesel are being varied in line with that. That should give some confidence to the people that the daily pricing mechanism determined by the market is in place.
While OPEC says the market is well supplied, Iran and Venezuela with production being affected might also be affected. Would it impact India in the short to medium term?
The oil scenario right now in the recent past has done ups and downs. It almost went up to $86 then reversed back to $80. Right now, it is hovering at $81. There were a lot of speculations also and there is a lot of uncertainty which people have factored in with regard to trade wars, the exact contours of the sanctions on Iranian barrels, whether Iranian barrels will be completely out of the market etc.
So some of that uncertainty is building and speculative positions unwinding. Some time back, it was always $80 plus scenario but that narration is changing. Now people are talking of a wider range from $65 to $100. So, both lower and higher side are there. Yesterday, I heard some people saying that the long-term view may be $60 to $70. So, it is looking more towards $80 than $90 now. As far as India is concerned, any increase in prices does hurt the Indian economy. We will always prefer that it should be lower.
