When two large oil consumers — India and China — speak the same language on oil price, it puts pressure on global producers.

Petroleum & Natural Gas Minister Dharmendra Pradhan, who has been taking up the issue of ‘Asian premium’, an additional cost which Indian oil importers pay to source crude, has now found a supporter in China.

Speaking to journalists here on Thursday after the closure of the 16th International Energy Forum, Pradhan said: “If China and India are on the same page regarding Asian premium, it’s a big step.”

He was responding to a question on Saudi Arabia denying that Asian consumers pay a premium rate. “Saudi Arab may have its own strategy, they are a producing county. But we are a consuming country. We have our own need and strategy,” he said.

In his inaugural address at the forum yesterday, Prime Minister Narendra Modi also asked oil producers to go for ‘reasonable pricing’.

Decarbonised energy

Pradhan further said that in the near future, the consumer will have a greater say on pricing, as the energy market dynamics is evolving with the use of technology, innovation, as well as availability of alternative energy sources. “Now there is no single source of energy, there is a consensus that gradually the energy vertical is going to decarbonise, renewable energy and clean coal are emerging in a big way. So consumption is going to be decarbonised. We need a responsible pricing,” he added.

In line with Pradhan’s observation, Li Fanrong, Deputy Administrator of China’s National Energy Administration, said: “Responsible pricing is an area for both China and India to work together. Not just as a consumer, but also as energy producers, to safeguard energy security. It is important to provide affordable, reliable and sustainable energy supply to our people.”

Asked if the energy space will see India and China coming together, Pradhan said: “In some countries, both of us are working in the same field. In so many points of Africa, CNPC and OVL are partners. (But) We are competitors, and certainly each has its own ambitions.”

“Sometimes our own companies compete with each other. There is nothing wrong in that. A fair competition should be there in business. But as a diplomatic partner, as a strategic partner we have some mutual interests,” he said.

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