China to surpass US as world's biggest oil importer: Goldman Sachs
09 Jan 2012;economictimes.indiatimes.com:LONDON: China is due to overtake the United States to become the world's biggest oil importer within a year and a half, Goldman Sachs said on Monday. Iranian oil displaced by the European Union embargo is likely to go into Chinese government reserves, Goldman Sachs said. "What happens to Iranian cargoes? Iranian cargoes are likely to go to China," Jeff Currie, head of commodities research for the investment bank, told a strategy conference in London. "Yes, China has reduced its imports of Iranian oil already, but it will likely take it in for SPR (strategic petroleum reserves) purposes in the first quarter." US oil imports have slid by 40 percent over the past several years as technological innovation in areas such as shale gas has boosted output, while demand has soared in China, Currie, told a strategy conference in London. "Within the next 12 to 18 months, China's going to surpass the United States as the biggest importer of oil in the world," he said.
09 Jan 2012;deccanherald.com:New Delhi: Part of development project dubbed ‘DelHy 3w’, a fleet of 15 HyAlfa three-wheelers will run on an experimental basis at Pragati Maidan, where a hydrogen refuelling station has also been set up. HyAlfa has been developed under a joint project by the United Nations Industrial Development Organisation (UNIDO) International Centre for Hydrogen Energy Technologies (ICHET), Mahindra & Mahindra and IIT-Delhi, with support from the Ministry of New & Renewable Energy. M&M President Automotive Pawan Goenka said “when mass produced it will cost Rs 20,000 to Rs 25,000 more than a CNG three-wheeler.” Project coordinator IIT-Delhi Professor L M Das said HyAlfa marks a journey of 20 years from “laboratory to land”.
Carmakers in India face a quandary: Diesel or petrol?
09 Jan 2012;timesofindia.indiatimes.com:NEW DELHI: Carmakers in India face a quandary: diesel or petrol? In a market where once-rampant growth has been stalled since mid-2011, demand for diesel-powered cars continues to surge, with buyers willing to wait months to take delivery because of a widening gap between prices of petrol and diesel. Even so, Maruti Suzuki and South Korea's Hyundai Motor Co (005380.KS), which together sell 70 percent of the passenger cars in Asia's No. 3 economy, are reluctant to invest to make more diesel cars, even if it means losing customers. "We are still contemplating," Arvind Saxena, director for sales and marketing at Hyundai's Indian unit. As with many industries in India, the plans of carmakers hinge on uncertain government policy. "If we invest, and in months, or years, the (diesel) price rises, we are left high and dry," Saxena said on the sidelines of the biennial India Auto Expo. India deregulated the price of petrol in June 2010, and prices have shot up 30 percent since then. Diesel, widely used by farmers and manufacturers, remains subsidised. Petrol, viewed as the rich person's fuel in India, now costs 56 percent more than diesel. However, the government is contemplating new taxes on diesel vehicles, according to news reports, and this could disrupt the demand pattern. The taxes could be announced in the 2012/13 budget that is expected to be handed down in mid-March. "In the absence of any clear policy, we are at a dilemma," said Mayank Pareek, head of sales and marketing of Maruti Suzuki, controlled by Japan's Suzuki Motor Corp (7269.T). "Our engineering people tell us that if you set up a plant (for engines) with a capacity of 100,000 vehicles, it costs 1,000 crores (10 billion rupees, or $189 million). Now the call of this decision is 1,000 crores -- to do or not to do?" DIESEL-POWERED SALES Diesel cars now account for about 40 percent of total sales in India, compared with less than 20 percent few years ago. Sales at market-leading Maruti Suzuki, predominantly a maker of petrol-fired cars, fell more than 16 percent in the nine months to December as a series of interest rate increases and rise in gasoline prices hit demand. The company was also hobbled by labour disputes. The demand slump forced Maruti to cut production of several petrol models in August, while some of its diesel models have a waiting period that runs to months. Maruti could have sold more cars in 2011 only if it had larger capacity to make diesel cars, Chairman R.C. Bhargava told Reuters in November, lamenting how competitors like utility-vehicle maker Mahindra & Mahindra (MAHM.NS), which only makes diesel vehicles, were enjoying strong growth. Nissan Motor Co (7201.T), which started making cars in India only in 2010, is better positioned. Its plant in Chennai can switch between diesel and petrol engines. "We're agnostic," Andy Palmer, an executive vice president at Nissan, said in an interview at the auto show. "If the government dictates that the diesel price is X, we give you diesel. If it's Y, we say: here's petrol."
09 Jan 2012;business-standard.com:Sharmistha Mukherjee:New Delhi: After Toyota Motor Corporation, compatriot Nissan Motor Company has started to delve into the luxury side of the passenger vehicle business in India. The third-biggest Japanese car maker, which retails its premium vehicles under the Infiniti brand, has undertaken a study to introduce the marquee brand in the country. Gilles Normand, corporate vice-president (Africa, the Middle East and India), Infiniti and light commercial vehicle business unit, Nissan, said, “The Infiniti will come to India. We are doing a study to determine how and when we will bring the brand to India.” The Infiniti portfolio for India could include the G series saloon (to take on the Mercedes C class, BMW 3 series and Audi A4), M series saloon (to take on the Mercedes E class, BMW 5 series, Audi A6 and Jag XF), EX series mini sport utility vehicles, or SUVs, (to take on the Audi Q5 and BMW X3), SUVs FX and QX series SUVs. Nissan introduced the Infiniti marquee in the US in 1989. Later, it expanded its presence in West Asia, South Korea, Russia, Taiwan, China, Ukraine and the UK. The marketing network for the Infiniti branded vehicles includes 230 dealers across 15 countries. In November last year, Toyota had announced its decision to launch the Lexus brand in India by 2013. It is working out the launch date, the product portfolio and the dealer network for retailing the Lexus cars in India. The vehicles would be marketed through an exclusive distribution network in line with the company’s global policy. The cars will be imported as completely built units from Japan. There has been no decision on assembling these cars in India.
09 Jan 2012;business-standard.com:Santosh Tiwari:New Delhi:The government is putting in place a mechanism to handle the possible impact on oil supply to the country because of international sanctions on Iran. A senior government official says the idea is to facilitate mutually beneficial ways to keep the supply going. Iran is the second largest supplier of oil to India after Saudi Arabia. National security adviser Shivshankar Menon held consultations with officials from the ministries of finance, petroleum and external affairs, and the Reserve Bank on Thursday. Hectic parleys took place subsequently in the finance ministry, involving officials from the department of economic affairs and the central bank. All this will be followed by a visit of a team of Indian officials to Iran in the middle of this month. Around 80 per cent of the country’s crude oil requirement is imported and about 12 per cent of it comes from Iran. Of the total imports of 163.59 million metric tonnes, Indian oil refining companies together imported 18.50 million metric tonnes of crude oil in 2010-11 from Iran. Though officials involved in the process were tight-lipped about the steps being envisaged due to the sensitivity of the issue, they indicated certain facilitating measures associated with foreign investment norms were expected to be put in place soon. India is also likely to ask for waivers on new US sanctions against Iran. Consultations in this regard have begun. Officials say the government is working in keeping with the framework outlined by Prime Minister Manmohan Singh to tackle energy security challenges in his New Year’s message to the nation. “We need assured access to imported energy supplies and also access to new energy-related technologies. This means we need policies that can promote economic partnerships with countries that have energy resources and technologies. We also need a pro-active foreign policy, protecting our access to such resources and to foreign technologies,” Singh had said. The officials stressed the efforts to maintain oil supply didn’t suggest India was endorsing Iran’s nuclear policy or would get into any other deal that could be construed as defence-related. US President Barack Obama last month signed into law new sanctions against financial institutions dealing with Iran's central bank — the main channel for the country's oil revenues. The development has been followed by an increase in global crude oil prices and indications of cuts in oil imports from Iran by China, Japan and some European countries. India's crude oil basket closed at $112.03 a barrel on Thursday, higher by $1.63 from its earlier close. In the first week of January, it averaged $110.12 a barrel. In December, the average was $107.20 a barrel.
08 Jan 2012;deccanherald.com:New Delhi: Fearing that fresh US sanctions may block a six-month-old conduit used for paying for Iranian crude, India wants to pay its second largest oil supplier in rupees. The issue is likely to figure prominently when a multi- disciplinary team visits Tehran on January 16 to discuss uninterrupted supply, a top government official said here. India currently pays Iran about USD 1 billion every month through Turkey for the 370,000 barrels per day of crude oil it buys from the world's fourth-largest oil producer. "There are chances that Turkey may come under pressure after a fresh round of US sanctions imposed on Iran," an official said. Under the proposal, National Iranian Oil Co (NIOC) will open a rupee account with Indian banks and can use the money to purchase non-strategic items like railway imports and buying commodities. It cannot, however, use the money to invest in India or buy shares or companies. A list of what Iran can do with the money and what it cannot is being prepared. The official said the Reserve Bank of India, which had in December, 2010, discontinued a long-standing mechanism of payment through central banks, had previously opposed payments for the Iranian oil in rupee. India had in February last year started making euro payments through an Iranian bank based in Germany. But under US pressure, Germany soon stopped accepting money from India for onward transfer to Hamburg-based EIH Bank, sending India to the doorstep of Turkey. Routing payments through Russia was discussed during the visit of Prime Minister Manmohan Singh to Moscow last month. However, Russia is not keen due to the "complexities" involved. US President Barack Obama signed a Bill into law late last month empowering US authorities to impose penalties on foreign banks dealing with the Central Bank of Iran to settle oil import payments. National Security Adviser Shivshankar Menon on Thursday chaired a meeting of officials from the ministries of finance, petroleum and external affairs and the Reserve Bank after indications from Turkey's state-run Halkbank that it would have to stop settling payments on behalf of Indian companies. The official said a preparatory meeting would be held in the Oil Ministry this week. New Delhi, however, sees no supply disruptions unless the Strait of Hormuz is closed. Iran has threatened to block oil deliveries through the Strait of Hormuz if sanctions are imposed on the country's oil industry over its nuclear activities. The US Energy Information Administration estimates that the strait carries about 20 per cent of all oil traded worldwide. India gets about three-quarters of its crude needs through imports and Iran is its second-largest supplier after Saudi Arabia. The European Union has also agreed in-principle to ban imports of Iranian crude oil to the EU. The official said annual crude supplies of 94.82 million tonnes from six Middle East nations could be hampered if the Strait of Hormuz is closed. Six Gulf nations, including Saudi Arabia and Iran, supply 58 per cent of India's total annual consumption of 163.59 million tons of crude. The closure may also hinder the 7.5 million tonnes of liquefied natural gas that Qatar ships through tankers each year to India, he said. However, New Delhi believes Iran may not take actually block the Strait of Hormuz and it using it as a point of posturing against the US. India, however, sees oil prices rising if the tension between Iran and the West continues. "If that happens, it will be difficult for us to manage," he said, pointing to the Rs 135,000 crore revenue loss that state-owned oil firms estimate at current oil prices on selling diesel, domestic LPG and kerosene below the imported cost this year. "We are finding it difficult to meet even these under-recoveries (revenue loss)," the official said. The new sanctions against Iran come with a wide range of exemptions and a grace period of six months. The EU is also debating the number of months it would wait to implement the sanctions and if long-term supply deals should be allowed to be completed.
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