Union Petroleum Minister Dharmendra Pradhan on Monday said that oil supplies to India will not be disrupted after an attack on Saudi Arabian oil facilities over the weekend halved the kingdom’s production.
“We have reviewed our overall crude oil supplies for the month of September with our Oil Marketing Companies. We are confident there would be no supply disruption to India. We are closely monitoring the evolving situation,” he said.
“Following the attacks on the oil stabilisation centres of Saudi Aramco, top executives of Aramco have been contacted. Indian ambassador in Riyadh contacted the senior management of Aramco to ensure steady supply to India,” he added.
Saudi Arabia is the world’s biggest oil exporter and the attack on state-owned producer Saudi Aramco’s crude-processing facilities at Abqaiq and Khurais has cut output by 5.7 million barrels per day. The company has not given a timeline for the resumption of full output.
Two sources briefed on Aramco’s operations told news agency Reuters that a full return to normal production volumes “may take months”.
India, one of the biggest importers of Saudi oil along with China and Indonesia, was expected to be vulnerable to the supply disruption.
Saudi oil exports will continue as normal this week as the kingdom taps into stocks from its large storage facilities, an industry source briefed on the developments told Reuters.
But oil prices surged nearly 20 per cent at one point on Monday, with Brent crude posting its biggest intraday gain since the Gulf War in 1991.
State-run oil company Hindustan Petroleum Corporation Limited said that the price of petrol and diesel at retail outlets might go up if the price of crude stays at current levels.
The attack on plants in the heartland of Saudi Arabia’s oil industry, including the world’s biggest petroleum-processing facility at Abqaiq, came from the direction of Iran, and cruise missiles may have been used, a US official was quoted as saying by Reuters.