PM shares oil ‘pain’ but Saudis unable to ‘help’

"Many factors lie outside the control of oil producers like us... we only control supply"

Prime Minister Narendra Modi on Monday warned oil producers like Saudi Arabia that higher crude prices are hurting global economic growth and they should do more to bring down rates to reasonable levels.

He also appealed to top oil producers to help nations like India to bridge what he called a "resource crunch" - a fallout of rising crude prices. This could be done by a review of payment terms to provide temporary relief to the local currency. He also made a strong case for a partnership between the oil producers and consumers as it exists in other markets.

Modi flagged off the concerns at the third annual brainstorming meeting with chief executives of top global and Indian oil and gas companies. He also asked why no new investments in oil and gas exploration and production were coming to India despite the government implementing all suggestions they had made in the previous meeting, sources said.

Later, speaking at the India Energy Forum, the Saudi oil minister said PM Modi had raised the issue of "consumer pain" inflicted by high crude oil prices. "We heard it loud and clear from prime minister," Al-Falih said.

He, however, added the "pain" would have been "much louder" but for the investment by Saudi Arabia in creating spare capacity, which has helped cushion price shocks. He said that the Prime Minister had cautioned producers like Saudi Arabia not to kill the hen that lays golden eggs.

The Saudi oil minister also said oil prices were not within their control. "Many factors lie outside the control of oil producers like us... we only control supply," he told reporters. At the same time, he reiterated that Saudi Arabia was trying its best to absorb the oil shock. ‘‘We could have another (round of) unanticipated disruptions that we have seen in Nigeria, Libya and Venezuela. And we have seen sanctions on Iran. These supply disruptions need a shock absorber and the shock absorber to a large extent has been Saudi Arabia,” he said.