Why in news?
Energy could take over from Defence as the strongest link in the Indo-U.S. relationship – with talks over increasing India’s imports of U.S. oil and gas, a clean energy deal including an MoU on building pipeline infrastructure for Liquefied Natural Gas (LNG) between American oil company ExxonMobil, gas transportation technology company Chart Industries and PSU Indian Oil Corporation Limited (IOCL).
- In 2019, India increased its intake of oil from the U.S. to about 1,84,000 barrels per day (bpd) which was four times more than in 2018, and up from zero imports just four years ago.
- Some of the increase is due to the fact that India had to slash imports from Iran and Venezuela under threat of sanctions from the U.S., but officials say the U.S. has tried to compensate by subsidising U.S. oil transportation costs.
- India is now the world’s third largest oil importer, and it is estimated that every $1 change in the price of oil internationally has a $1 billion dollar impact on India’s energy bill.