West Asia crisis has made India more energy secure, Pg13

Key Highlights:

• Oil prices stabilized at $74 per barrel by the end of June, returning to pre-crisis levels.
• India successfully managed the energy crisis by ensuring continuous supply and protecting consumers from price hikes.
• The government incurred a revenue loss of ₹1.7 lakh crore to maintain stable domestic fuel prices.
• Domestic LPG production was significantly boosted from 35,000 to 54,000 tonnes per day through an LPG Control Order.
• India diversified its crude oil sourcing from 27 to 41 countries and ensured safe passage of its vessels through the Strait of Hormuz.

Detailed Insights:

• India implemented a two-pronged strategy involving demand-side management through 20% ethanol blending and pushing electric mobility.
• Consumers were protected as oil marketing companies and the government absorbed a large part of the import price burden.
• The regulated price of LPG for Pradhan Mantri Ujjwala Yojana beneficiaries was maintained at ₹642, with a direct benefit transfer of ₹300 per month to nearly 10.6 crore households.
• LPG import terminals doubled between 2011 and 2022, increasing the country’s import capacity from 12 MMTPA to 32.4 MMTPA.
• The City Gas Distribution Network expanded significantly from 55 cities to over 300 cities during the same period, alongside a doubling of LNG import terminals.
• The Ministry of Petroleum and Natural Gas, Ministry of Ports, Shipping and Waterways, MEA, and the Indian Navy coordinated to ensure the safe passage of Indian ships through the Strait of Hormuz.
• India is enhancing its long-term energy security by stepping up domestic exploration efforts and acquiring oil and gas assets abroad.

Key Concepts Involved:

• Ethanol Blending Programme (EBP): A government initiative to blend ethanol with petrol to reduce crude oil import dependence, save foreign exchange, and reduce environmental pollution.
• Pradhan Mantri Ujjwala Yojana (PMUY): A flagship scheme launched in 2016 by the Ministry of Petroleum and Natural Gas to provide clean cooking fuel (LPG) to women from deprived households.
• Strait of Hormuz: A narrow, strategically vital waterway connecting the Persian Gulf with the Gulf of Oman and the Arabian Sea, crucial for global oil and gas transit.
• City Gas Distribution (CGD) Network: An interconnected system of pipelines for supplying Piped Natural Gas (PNG) to domestic, commercial, and industrial customers, and Compressed Natural Gas (CNG) to the automotive sector.