The sale of domestically produced crude oil and condensate was approved by the Cabinet on October 1, 2022, chaired by Prime Minister Narendra Modi. The news was confirmed by Union Information and Broadcasting Minister Anurag Thakur in a press conference after the Cabinet meeting on Wednesday.
Business Today reported earlier in the day that a decision was being made in the pipeline, and this move will encourage companies to boost crude oil production inside the country. India is the third largest consumer of oil after the US and China. India depends on imports to meet 85 per cent of its oil and energy needs.
As per Thakur, the decision will ensure marketing freedom for all companies involved in oil exploration and production. Exploration and production companies are free to sell crude oil from their fields in Indian market and exports will not be allowed.
Thakur said that policies will be transparent and revenue won't be impacted. In fact, it will lead to an increase in exploration and domestic production of crude oil. Around 80 -- 90 per cent of the quota allocated to refineries was used in 2018 -- 19 and 59 per cent in 2019 -- 20. If the decision comes into effect, conditions in production sharing contracts to sell crude oil to government or any of its nominees or government companies will be waived off. Revenues royalty, cess, etc., are paid by the government. The uniform basis will be calculated across contracts.
Oil imports from Russia have jumped over 50 times since April, making up for 10 per cent of all crude purchased from overseas. In May, Indian refiners bought 25 million barrels of Russian oil.