Be responsible in pricing oil, Pradhan tells Opec

Vienna: India, the world's third-biggest oil consumer, on Wednesday pressed OPEC nations to move to responsible pricing of oil and gas saying the present rates are far detached from market fundamentals.

Speaking at an OPEC seminar here, Pradhan said, often global trade practices in the field of oil and gas are not contributing to energy access and affordability to all.

"Political conditions, sometimes internal and sometimes external, result in reduced output of some countries. We expect from OPEC and its members a commitment to step in (and) more than fill the gap to ensure sustainable prices," he said.

Stating that current high oil prices dent the economic development of many countries, he said already fragile world economic growth will be at threat if oil prices persist at these levels.

"My fear is this will lead to energy poverty in many parts of the world," he said.

Pradhan said the world has for too long seen prices on a roller coaster and interventions which are detached from market fundamentals.

"It is high time to move to responsible pricing, one that balances the interests of both the producer and consumer. We also need to move to transparent and flexible markets for both oil and gas," he said.

"We often see global trade practices in the field of oil and gas which are not contributing to energy access and affordability and become a hindrance to sustainability. Price of oil and gas have become subject to vagaries of geopolitics," he added.

The minister said globally crude prices have gone beyond the threshold which can be sustained by the world. "These prices are creating stress throughout global economy, as it is giving pain to us in India."

The global economic outlook already has threats from trade wars, geopolitical events and fear of instability coming back to the Euro Zone. "The already fragile world economic growth will be at threat if oil prices persist at these levels," he said.

India, he said, is not in favour of prices as low as $30 per barrel but it also does not support the prevailing high price which dent fiscal balance and undermine development process.