If prices stay high, consumers will have to pay more: MK Surana, HPCL

If prices stay high, consumers will have to pay more: MK Surana, HPCL

How do you see sanctions against Iran impacting Indian refiners?

It’s early days and the full import of the sanctions would be clearer only with time. We will have to look at the nature of the sanctions, its modalities and the way it’s implemented. We have dealt with sanctions against Iran before, but this time it’s a little different. Europe is thinking differently. EU has several trade arrangements with Iran and that would have some bearing on the issue.For refiners, the most important thing is oil supply. There are alternative sources of supply available, so it shouldn’t be an issue for refiners though Iran does offer some freight concessions. During last sanction, the US didn’t export oil but today, it does. Last time, people grappled with the problem and slowly figured out some solutions. Those experiences would surely be useful this time.

Oil prices are rocketing…

There is no reason for crude oil to spike since there are enough global inventory though production in Venezuela and Libya have been dropping. Paper trading is substantially higher than physical trading now. Speculative trading will have to unwind at some point. Prices may cool down then. If you look at fundamentals, a price below $70 looks more reasonable than the current range of $70-80 a barrel. Read More

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