Rs 7-9 petrol, diesel price hike inevitable; weak OPEC good for India: Energy expert Narendra Taneja | Exclusive

Renowned energy expert Narendra Taneja in a exclusive conversation on Business Today Television (BTTV) during Market Masters show with Shailendra Bhatnagar, Chief Analyst & Editor, Markets, discussed the inevitability of fuel price hikes in India due to the ongoing global energy crisis. Here are the key takeaways from the discussion:-

Inevitable Price Increase:

Taneja stated that a price hike for petrol and diesel is "inevitable". He anticipates a cumulative increase of approximately ₹7 to ₹9 per litre.

Phased Implementation:

Rather than a sudden, one-time shock, he suggests the government will likely opt for a "middle path," implementing gradual, smaller hikes (e.g., 50 to 90 paise at a time) to manage the impact on the public .

Government Dilemma:

Taneja acknowledged the government's difficult position given that oil is highly sensitive politically and impacts both the poor and wealthy, especially the 80 crore people below the energy poverty line.

Need for Stability:

To protect state-run oil companies (like IOC, BPCL)—which are struggling financially and are crucial for maintaining national energy security—he suggested that the government might introduce measures similar to the "oil bonds" used in the past to provide financial stability.

Also, answering a question on the exit of UAE from OPEC and the importance of Fujairah for India,  Narendra Taneja discussed the relationship between OPEC, the UAE, and India extensively. Here are the key insights:

Weakening OPEC: 

Taneja highlights that OPEC has become a "divided house" over the last three years, as countries like the United Arab Emirates have increasingly ignored production quotas to pursue their own capacity expansion goals.

Good News for India: 

He explicitly states that a weakened OPEC—or the potential dissolution of such cartels—is "very good news" for India. He characterizes the idea of oil cartels as "medieval" and incompatible with the modern era of AI.

Strategic Energy Security: 

Because India is a major energy importer, Taneja argues that deepening energy ties with individual nations like the UAE is more sustainable and geopolitically beneficial for India than relying on the traditional cartel structure.

 

WATCH FULL CONVERSATION: Energy Expert Narendra Taneja On India’s Energy Crisis & Oil Shock