The battle for Asia in crude oil markets: an easier road ahead for India?

Journal article

Two significant events which occurred in the oil market in 2014 have the potential to reshape India’s historical struggle with oil and fiscal deficits. The first is the complete deregulation of major petroleum products prices and the second is the sharp fall in oil prices amidst a fight for market share in Asia among crude producers, implying importing countries like India are now spoilt for choice and in a far better position to bargain for better prices. Even though the drop in prices is unlikely to last (given the high cost on the supply side) and prices are likely to pick back up to at least the US$80–100 per barrel range in the coming years, India will remain in a privileged position compared to a few years ago, as the continued growth of US tight oil means producers from all around the world will still focus on Asia to sell their crude. This, together with the deregulation of product prices, will help boost Indian fiscal balances immensely, in a complete reversal of the trend seen over the past decade.

Authors: Sen, A

• Publication status: Published
• Peer review status: Peer reviewed
• Publisher: Oxford Institute for Energy Studies
• Journal: Oxford Energy Forum
• Issue: 99
• Pages: 5-7
• Publication date: 2015-03-09
• ISSN: 0959-7727
• Language: English
• Keywords: OIES