Domestic crude oil fell 3.93 per cent in August 2016, while natural gas output dropped 5.72 per cent year-on-year, according to data released by the Ministry of Petroleum and Natural Gas.
Industry experts fear that the declining trend may continue as globally prices of both oil and gas are under pressure, which in turn puts pressure on margins of exploration and production companies. From October 1, India will announce its revised gas price, which will be effective for the next six months.
The domestic gas prices for the October 2016 - March 2017 period is expected to be lower than the prevailing $3.06 at gross calorific value. “Gas prices have been coming down. As per our workings, the price from October 1 could be $2.5 per mBtu or even lower,” DK Sarraf, Chairman and Managing Director, ONGC, had indicated.
Natural gas production stood at 2.674 billion cubic metre during August against 2.836 billion cubic metre in the same month last year.
The fall in production was mainly due to a drop in ONGC’s offshore gas production as well as a drop in output from fields of private operators. ONGC’s offshore natural gas production fell 3.03 per cent in August compared to 1.412 billion cubic metre the same month last year.
Domestic crude oil production stood at 3.067 million tonne in the month of August compared to 3.193 million tonne in the same month last year. Crude oil production was impacted by 3.31 per cent lower production from ONGC, 1.43 per cent lower production from Oil India and a 0.97 per cent lower production from Cairn India’s Rajasthan fields.
Further, refinery throughput during the month grew 3.46 per cent during the month to 20.290 million tonnes compared to 19.611 million tonnes in the same month last year. India’s crude oil imports also went up around 9 per cent to 18.811 million tonnes as compared to 17.235 million tonnes in the same month last year.