US crude export to India will bring economic stability, create jobs: Energy Secretary

India now joins Asian nations such as Japan, South Korea and China to purchase American crude.

The Dollar Business Bureau

US Energy Secretary Rick Perry said on Thursday that export of crude oil from the US to India will help in creating jobs, and bring economic stability in both the nations. The statement comes after a few days of the first-ever consignment of American crude oil reached India.

The shipment loaded last month from the terminals of Freeport in Texas and St James in Louisiana and reached at Odisha’s Paradip port on October 2.

“This event represents the growing and important strategic energy partnership between the US and India, and I look forward to exploring new opportunities to expand the role of reliable, responsible, and efficient energy sources with our allies,” the Energy Secretary said.

He said that following the visit of Indian Prime Minister Narendra Modi to the US, Indian firms have increased the purchases of US crude. In order to encourage purchases of American crude, refiners has been allowed by the Government to use an international vessel rather than Indian-owned vessel for buying crude.

Indian refiners normally use local vessels for importing crude.

For Indian refiners, purchasing crude from the US becomes attractive as the difference between the Brent Crude (the benchmark crude which serves as price reference for western countries) and Dubai (that serves as a benchmark for price reference in the eastern world) has narrowed down.

India, which is the third largest importer of oil in the world, joins the list of Asian nations such as Japan, South Korea and China to purchase American crude after the cut in production by oil cartel OPEC (Organisation of Petroleum Exporting Countries) pushed up prices of heavy-sour crude of Middle East.

The Dollar Business Bureau - Oct 06, 2017 12:00 IST