India urges oil industry to invest and increase supply

March 19th, 2009 - 8:35 pm ICT by IANS  

New Delhi, March 19 (IANS) India Thursday warned that under-investment in the petroleum sector would lead to a “demand-supply crisis” in the near future and urged the oil industry to pump more money in augmenting supplies.
This was stated by Petroleum Minister Murli Deora while addressing the fourth OPEC International Seminar in Vienna.

“The present economic and financial crisis, coupled with prevailing level of oil prices, is causing a real risk that under-investment in the industry will cause an oil-supply crunch,” he said at the seminar, according to a government statement released here.

The seminar was organised by the petroleum cartel, Organisation of the Petroleum Exporting Countries (OPEC).

Deora noted that there was a common worry that the “slackening pace of investment in the oil sector will provoke wide disparity in demand and supplies of tomorrow when the world is out of recession”.

“It is important that the industry should focus on supply augmentation and avoid taking a short-sighted view,” he said, warning that under-investment would put a “big question mark” on sustainable future supplies.

“I am sure that in due course, the economic downturn would be arrested. The investment we make now will help us move towards a path of global economic recovery,” Deora said.

He hoped that the upcoming Group-20 meeting would come out with “positive measures” to tackle the slowdown.

The minister expressed concern that the economic slowdown had affected the promotion of renewable energy sources. “I understand that prices of carbon trading have come down, which is acting as a disincentive to promote use of green energy.”

“At this conference, we have to collectively resolve that our efforts towards lower carbon footprints are not allowed to put on a back burner, despite the global economic downturn, which, I am sure, is at best a temporary phenomenon”.

He urged all stakeholders to pro-actively work in this direction and earmark sufficient financial resources for this purpose.

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