The oil problem

Why have we not been able to solve it yet?

- PUJA MEHRA

Nearly eight years ago, back in 2014, immediately after the Modi government was sworn in, Dharmendra Pradhan was made oil minister. The job is a difficult one, especially for a first-time minister. The mood, especially in the cities, at that time was of extreme discomfort over the high prices of fuels and cooking gas. Rising global crude prices had thrown kitchen budgets out of gear. Pradhan had told me within days of taking charge that India’s energy security was going to be one of the main elements of the new government’s agenda: “We will ensure greater efficiency, professionalism and accountability in public sector oil companies so that they generate the profits required for domestic expansion and overseas acquisitions of assets as part of our energy security strategy for India” (https://bit.ly/3xv33Yu). He said that the 10-year tenure of the UPA government had shown that unless the energy sector is managed well, it pushes the costs in an economy: “Please give us about a year to deliver on it… we will reform and take steps to ensure the investment potential is realised in this sector that has 100 per cent Foreign Direct Investment permissible”. Eight years later, increases in global crude prices still pinch average Indians’ pockets – prices were $105 a barrel at that time, before plummeting sharply to $20 a barrel, staying low for years, and are back to $100 plus a barrel again now. Is there no way to escape this pain?