New Delhi: The UAE’s exit from OPEC could prove quite beneficial for India, which is trying to secure its energy requirements in the long run after the recent shortage in supplies amid the military conflict in West Asia, officials said.While Abu Dhabi has decided to increase production without being constrained by OPEC quotas, officials said this could become an opportunity for India to get oil at lower prices from a friendly and geographically close supplier.India imports about 90% of its estimated daily crude oil consumption of 5.8 million barrels. A senior government official said this could provide an opportunity for India to enter into a long-term oil trade agreement with the UAE without being bound by OPEC production restrictions on member countries.“This would be beneficial given the logistical advantages and the high quality of crude oil exported from the region,” an official said. “Crude oil prices can also be negotiated in view of India’s strategic partnership with the UAE.” When Sujata Sharma, joint secretary in the petroleum ministry, was asked to comment on the impact of UAE’s exit from OPEC on India, she said it was too early to comment.The UAE is the third-largest oil producer among OPEC members after Saudi Arabia and Iraq and contributes about 13% of the group’s total output. While the UAE’s oil production capacity is estimated at 4.2-4.5 million barrels per day, it currently produces about 3-3.2 mbd and plans to increase production to 5 mbd by 2027. “Since the UAE is closer to India than the US, Russia and African countries, more purchases will mean lower freight charges,” the official said, adding that this will also reduce India’s import bill.
