Modi’s grand tour: India links up with UAE, Europe to ‘hedge’ global shocks
Seizing on the UAE’s Opec exit and a new EU trade pact, India’s PM looks to lock-in long-term energy supply and economic dividends
As Opec’s sixth-largest producer, the UAE’s exit from the cartel’s quota system frees it to pump beyond its previous ceiling of 4.8 million barrels per day, giving it the flexibility to lock in preferential supply arrangements with favoured partners.
India – which imports about one-tenth of its oil from the Gulf nation and is the UAE’s largest liquefied natural gas customer, according to local media – sits near the top of that list.
The timing of Modi’s visit was probably “no coincidence”, said Srinivasan Balakrishnan, director of strategic engagements and partnerships at the New Delhi-based Indic Researchers Forum.
“Abu Dhabi’s move to ditch [Opec] quotas and ramp up production … gives it flexibility to supply more oil and LNG directly to key buyers like India.”