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  • Home
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  • DAILY CURRENT AFFAIRS:Government allows selling of domestic crude oils to domestic refiners

Government allows selling of domestic crude oils to domestic refiners

Tags: Economy/Finance

In a significant policy decision taken by the Union Government on 29 June 2022, it has allowed the oil exploration companies to sell the crude oil produced in India to the oil refiners in India. It will be applicable from 1 October 2022.

  • It means that ONGC, and Vedanta sell locally produced crude oil to any Indian refinery for turning it into fuel, such as petrol and diesel.
  • Up till now the domestically produced crude oil was to be sold as per the government direction. The government had mandated the sale of the domestically produced oil to the government owned oil companies like IOC, HPCL, and BPCL etc.
  • In the present system, the government fixes the quantity each buyer will pick and the crude oil is sold at a discount to the buyer.
  • Now, the crude oil producer can e-auction the crude to anyone paying the highest price from 1 October 2022.
  • The Government said that the government revenues like royalty and cess will continue to be calculated on a uniform basis across all contracts.
  • There has been no change in the earlier policy of the government which has banned the export of crude oil from India.
  • The major crude oil producing companies in India are government owned ONGC, Oil India limited and Private companies like Vedanta which has oil wells in Rajasthan, Andhra Pradesh and Gujarat.

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