New Delhi: The crude oil rates are crashing in the international markets. The crude oil rates have plummeted by nearly 40% in the last week, resulting in a slide of USD 30 per barrel. As per experts, the sliding oil prices in the international markets become an opportunity for a country like India, who imports 80% of its oil requirements. The Indian government has also decided to make use of this opportunity. The government has decided to fill up its strategic oil storage centres. It is reported that appreciating the fact that the oil supply may be affected due to the Coronavirus pandemic, the government has also decided to create an additional oil stock.
The oil prices are consistently falling, following the failure of talks between the OPEC Plus countries. These rates have gone below USD 30 per barrel and there is a possibility of a further decline. India imports massive quantities of oil. This puts a major strain on the economy. Therefore, the government has decided to take advantage of the situation while the oil prices are down. The government has initiated steps in that direction.
Since the last five years, the government has given stress on creating a strategic stock of oil for an emergency where the oil supply may stop. Underground strategic storage tanks have been built for this purpose. These tanks are located in Mangaluru, Vishakhapatnam and Padur. Such underground tanks are also being built in Odisha and Jaipur.
The Indian government is making moves to get these strategic storages filled by taking advantage of the plummeting oil prices and is also making an effort to build an oil stock of 5 million barrels, taking into account the possibility of disruption in the oil supply because of the Coronavirus pandemic. The Karnataka strategic oil storage facility has a capacity of 36 million barrels. The petroleum ministry has demanded ₹50 billion (USD 673.3 million) from the finance ministry for this oil purchase. The petroleum ministry intends to buy 8 to 9 crude carriers with these funds.