Oil and diplomacy continue to mix with the government now deciding to push the International Energy Forum (IEF) as the main platform for energy and oil security of developing nations.
Soon after the mini OPEC meet in January 2005, the petroleum ministry began planning to use the umbrella and credibility of IEF to carry out four studies.
According to a senior official in the petroleum ministry, the mini OPEC had identified four crucial areas for the Asian countries improvement in the Asian oil market, criss-cross investments by producers and consumers of Asia (like the recent Saudi and India deal), more R&D to improve energy efficiency, and environment-friendly fossil fuels.
India will take these issues to the IEF which will soon meet in Rome and ask for studies to be commissioned. The IEF has 60 members, largely from the developing world.
India and other Asian nations are now viewing IEF as an alternative to OPEC and the other platforms of the developed nations. Of course, the studies will have greater acceptance, the ministry official said.
A meeting of the four key Asian buyers India, China, Japan and Korea is also on the cards, but no timeframe has been set. One thing is clear: the move towards a much-touted Asian marker (a benchmark for oil prices for Asian buyers) is not on top of the agenda.
According to the ministry official, The Asian marker is a long-term dream for Asian buyers, but its not finding greater acceptance among the Asian sellers. This still continues to be touchy issue and hence in the present circumstances we might not press for it, the official said.
Apart from these multilateral moves, India is also moving ahead with its planned cooperation with China in the oil sector. The two countries are looking for joint bids for international oil assets and the three sub-groups looking into financial and technical aspects will meet in May 2005.
While disassociating from the US discomfort at the proposed Indo-Iran pipeline, the official stressed that gas pricing is likely to emerge as the major issue. The price of the LNG which India has contracted with Iran cannot be a benchmark for the gas to be delivered through the pipeline, the ministry official said.
The official argues that though a decision has been taken to take delivery of the gas at the border, at stake is a domestic infrastructure of Rs 25,000 crore.