Subir Raha, the government-appointed head of India’s biggest oil company, said the U.S. would be “stupid” to attack Iran and risk imposing record oil prices on the global economy.
The U.S. invasion of Afghanistan in 2001 and Iraq in 2003 helped send oil to a record $57.60 a barrel on March 17 in New York, Raha, chairman of Oil & Natural Gas Corp., said in an interview on the outlook for oil and the company’s revenue in New Delhi yesterday.
“You launch one more attack and you can’t even guess where the speculation will go,” Raha said. “With the stalemate in Afghanistan, stalemate in Iraq and elsewhere, you already have a price of $55 a barrel.”
India, the third-biggest oil consumer among 45 nations in the Asia Pacific region, relies on Iran and other Middle East nations for more than half of its oil. Secretary of State Condoleezza Rice said March 16 the U.S. has “concerns” about India’s plan to buy gas from Iran. The U.S. has expressed skepticism about Iran’s nuclear intentions, and President George W. Bush said March 11 it wouldn’t tolerate a nuclear-armed Iran.
“I see no reason why India’s priorities should be subservient to U.S. priorities,” said Raha, who has worked for state-run oil companies for the past 35 years. “The U.S. is chasing oil and gas as badly as China or India or anybody else.”
Iran, the Middle East’s second-biggest oil producer and holder of the world’s second-largest natural-gas reserves after Russia, doesn’t need nuclear energy, the U.S. said as recently as March 16.
Bush
Bush on Feb. 22 said “all options are on the table” after describing as “ridiculous” speculation that the U.S. is getting ready to attack Iran.
If the U.S. is “stupid enough to attack Iran,” Raha, said, “the whole marketplace will go up. No one knows what will happen.”
India’s Oil Minister Mani Shankar Aiyar said on March 10 the U.S. Ambassador, David Mulford, met him to express concern about India’s plan to import gas from Iran through a pipeline.
“We have noted what U.S. concerns are,” Aiyar said. “I think the U.S. is well aware of our energy requirements. So far we are sensitive to each other’s requirements.”
Oil & Natural Gas, which was formed by the government in 1959 and became India’s most profitable company, will buy 20 percent of Iran’s Yadavaran oil field and may take a stake in the Juffair field, the company said in a statement on Jan. 7.
Share Sale
Raha, who last year sold $2.3 billion of Oil & Natural Gas shares in 20 minutes, said the company may spend up to $25 billion on stakes in oil and gas fields abroad. The share sale was the country’s biggest ever.
Raha started his career in 1970 with Indian Oil Corp., the nation’s largest oil refiners. Oil & Natural Gas, which he joined in 2001, will boost revenue fivefold in five years to $50 billion by drilling in countries from Venezuela to Sudan and Russia, building plants to refine the oil and gas stations to sell it.
India is in talks to acquire assets of OAO Yukos Oil Co. confiscated by Russia, a country that may supply a fifth of India’s oil.
Oil & Natural Gas would like to ensure “that when India has a demand of 5 million barrels a day, 1 million barrels comes out of Russia,” Raha said. India now consumes 2.4 million barrels a day.
Economic Growth
India’s oil demand is surging after Asia’s fourth-largest economy last year expanded at its fastest pace in 15 years. To help meet demand, Oil & Natural Gas is stepping up drilling for new fields.
The company plans to form a partnership with Exxon Mobil Corp., the largest publicly traded oil company, to help find oil in deep water off India’s coast. Exxon produces oil from the Hoover and Diana fields under 4,800 feet (1,463 meters) meters of water in the Gulf of Mexico.
“We have these deep water blocks where we are offering farm- out opportunities,” Raha said. “Exxon said they are interested.”
To contact the reporter on this story:
Manash Goswami in New Delhi at [email protected]
To contact the editor responsible for this story:
Reinie Booysen at [email protected].
