MK Surana, CMD, Hindustan Petroleum Corporation Limited (HPCL), on Tuesday, said that crude prices are being impacted by the Russia-Ukraine tensions and also on account of discussions between Iran and the US. He also highlighted that there is a shortage in crude production to the tune of 9 lakh barrels from the Organization of the Petroleum Exporting Countries (OPEC) plus.

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Surana said, "There are three factors which are affecting the crude prices right now, one is, of course, the Russia- Ukraine situation, second is a contrarian view which is coming because of Iran-US discussion and third is the constant inability of OPEC to ramp up production to the extent of what is authorised. So, there is a shortage of around 9 lakh barrels per day production capacity from the OPEC plus, than what it is supposed to be."

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Surana believes demand for diesel should pick up. However, he mentioned that he cannot comment on the taxation of fuel prices.

He said, "Now that the third wave fears are almost gone, I think the diesel demand should pick up and there is a news that mid-March or so, international travel may start so demand is going to pick up and we expect it to be at pre-pandemic levels by the end of this year, which means by March."

Surana said that HPCL has managed its debt well. He added that the company has done capex of Rs 12,300 crore so far. He believes the company’s capacity would increase to 45.5 million metric tonne with the expansion projects. He also highlighted that major projects have been completed.

On debt he said, “We have gone through capex phase in the last four years and we are done with respect to major projects, some of them has completed, some are getting completed and we have managed our debt levels quite well, thanks to the profitability of the company.”

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On expansion of capacity, Surana said, “HPCL plus HMEL, we got around 27 million tonne of capacity and that will become 45.5 million metric tonne, and we will have around 2.4 million tonne of petrochemicals from Rajasthan plus around 2.1 from HMEL after the current petrochemical project of HMEL also gets completed. In the current year we had a capex of 14,500 and we have already done around 12,300 crore as of now."

Watch the video for the full interview.

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