Minister of State for Petroleum and Natural Gas Suresh Gopi has said that the government has been closely monitoring the global energy market’s situation in the backdrop of evolving geopolitical events and is ready to take all appropriate action, as deemed fit, for mitigating market volatility. In a written reply in the Lok Sabha today, Mr. Gopi said the government has taken several steps to insulate common citizens from high international prices, which include diversifying the crude import basket, invoking the provisions of the Universal Service Obligation to ensure the availability of petrol and diesel in the domestic market, and increasing the blending of ethanol in petrol.

He said the government, through a special purpose vehicle called Indian Strategic Petroleum Reserves Limited, has established strategic petroleum reserves facilities with a total capacity of 5.33 million metric tonnes (MMT) of crude oil at 3 locations: Vishakhapatnam, Mangaluru, and Padur. The minister said, in July 2021, the government approved the establishment of two additional commercial-cum-strategic petroleum reserve facilities with a total storage capacity of 6.5 MMT at Chandikhol in Odisha and Padur in Karnataka on a public-private partnership mode.

He said prices of petrol and diesel are market-determined, and public sector oil marketing companies (OMCs) take appropriate decisions on the pricing of petrol and diesel. Mr. Gopi said India imports more than 85 percent of its crude oil requirements. He said crude oil prices have continued to remain highly volatile. He said, as a result of various steps taken by the government and PSU OMCs, including reduction of central excise duty by the central government and reduction of state VAT rates by some state governments, relief has been provided to citizens in times of need. The minister said India imports about 60 percent of the domestic LPG consumed. The price of LPG in the country is linked to its price in the international market. The government continues to modulate the effective price to consumers for domestic LPG. Currently, the government is providing a targeted subsidy of 300 rupees per cylinder to Pradhan Mantri Ujjwala Yojana consumers. He said this is available to more than 10.33 crore Ujjwala beneficiaries across the country. Mr. Gopi said, apart from the direct subsidy to consumers, the OMCs have also been compensated 22 thousand crore rupees in the financial year 2022-23 by the Government of India to cover the under-recoveries suffered by them in not passing on the high international LPG prices to the domestic LPG consumers.