Indian oil diplomacy update

India is beginning to stand up to OPEC

Secular-Right and the Brooding Dude cover recent developments on the oil diplomacy front.

Cartel members, Saudi Arabia in particular, are extorting money from our over-burdened taxpayers and consumers, then using these ill-gained profits to export virulent jihad to our sphere of influence. This is an existential threat to India against which the only real, albeit serendipitous, counterpunch so far has been the American neo-conservative project.

When the so-called progressives (e.g., the enormously misguided Arundhati Roy and Michael Moore) decry America’s neo-conservative intervention in Arabia as an oil-motivated war, we can only hope this is, at least partly, so. Afterall, the burden of high-priced Gulf oil is falling squarely on India’s poor and the emerging middle class — even worse, profit from this oil funds jihadi terrorism which seeks to kill them. Any change in this dynamic is good for Indians, therefore good for India. That many Indians support these extortionist Sheikhs and dictators, scrambling to keep their blood-dimmed crowns, continues to baffle us. [Secular-Right]

The Brooding Dude writes that India is working with other large Asian oil consuming nations to form a buyers bloc.

…the partnership proposal that (India’s petroleum minister) Aiyar is proposing goes beyond just price negotiations, and pushes investments too. Investments promote oil security like nothing else. Further, securing oil equity means getting oil at almost cost price – which brings down the costs significantly.

All in all, this latest move smacks of an Asian buyers’ cartel formation. Today they are negotiating the removal of the premium, tomorrow it could be for investments, and later block deals. Further cartelization of the big Asian countries means that together with Europe and the US (Which means getting three groups together as opposed to maybe 10 earlier), a world wide buyers’ cartel could be formed, which would be as powerful as OPEC is a sellers’ cartel. [Can’t Help Thinking]

While the word ‘cartel’ cannot be applied to buyers in a strict sense, trying to pull together a buyer’s bloc is a good idea. But a lot depends on whether Asian geopolitics will allow a close-enough relationship to develop among them. China has its own plans; it is pulling no stops in building a deep-water port at Gwadar in Pakistan’s unruly Balochistan province. The port is linked back to Chinese territory by modern all-weather roads. Gwadar gives China an excellent gateway to the oil-rich Gulf region. Pakistan, for its part, would not be too keen to see an overly cooperative relationship developing between China and India, especially over oil. That would make the Pakistanis all the more malleable to the Chinese.

As always, for this buyer’s bloc to succeed, it will have to ensure that it is able to deliver more than what individual buyers can manage on their own.

3 thoughts on “Indian oil diplomacy update”

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  2. Gwadar will not help China combat the edge India has with regards the geographic proximity with the Middle East. While Gwadar may be linked to Western China, the real market lies across the vast Gobi desert and well into the East reaches of China. Transporting oil or gas over these regions over the surface would work out as cheap or expensive as shipping it through the Straits of Malacca. Otherwise, they have no reason to look to the Middle East – they have easy access to Central Asia and wonderful relations with the countries there.

  3. hai,
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