The International Energy Agency (IEA) estimates that global oil supply will increase by 1.8 million barrels per day in 2025 to 104.7 million barrels per day, compared with 660 thousand barrels per day in 2024. Oil and gas industry is on a transformational journey due to rising concern over sustainable development, affordability and energy security. With rising global energy demand and a rapidly growing economy like India the industry must innovate to take on the challenges of climate change, economic growth and geopolitical instability. This motivates companies to adopt green energy strategies such as investing in renewable energy and hydrogen to reduce their carbon footprint over the long term. However, the fluctuation in oil prices affects consumers around the world. Energy security is becoming more important as Indian corporations strive to diversify their energy mix and reduce their dependence on foreign sources.
Sustainability is major concern in oil and gas sector in order to face climate changes and consume resources. A transition into greener energies is an environmental need also become an important business imperative to compete successfully in an evolving marketplace. Bharat Petroleum Corporation Limited (BPCL) plans to increase its refinery capacity to 900,000 barrels per day by 2028, build up petrochemical complexes in Kochi and Bina, targets net-zero carbon emissions by 2040. The company also plans to invest ₹1 trillion in green technologies and put up 2 GW of renewable capacity by 2025 thus the installation capacity will reach 10 GW by 2035.
Krishnakumar, Chairman, Bharat Petroleum Corporation Limited said, "These combined efforts, along with the upcoming commissioning of a bio-ethanol refinery, positions BPCL as a key player in India's transition to a greener fuel mix, creating a robust ecosystem for the adoption of cleaner fuels across the country."
The industries focus on aligning strategies with global climate goals such as achieving net-zero emissions. It aims for ambitious sustainability targets, enhances transparency in reporting, and is increasingly partnering with stakeholders towards a positive transformation. A key business strategy is to align operations with innovative technologies that reduce emissions and enhance energy efficiency, as well as incorporate renewable energy sources. Carbon capture, utilization, and storage (CCUS) have become significant among industries. According to the research by InsightAce Analytic, the Carbon Capture, Utilization, and Storage Market is expected to reach US$ 17.37 Bn by 2031, with a CAGR of 21.2% during the forecast period of 2024-2031. Industry reduces the emission of greenhouse gases through industrial processes also researching the production and use of green hydrogen, which no emissions. Technologies such as AI and IoT-in enhance efficiency and reduce waste while leading towards the ecosystem’s development.
Reliance Industries Limited (RIL) remains the forefront of efforts for sustainability in the oil and gas sector. The list of strategies employed to reduce its carbon footprint includes investments made in renewable energy and the development of green technologies. RIL has committed to net-zero emissions by 2035 and is working on diversifying into renewable energy, such as solar and wind power projects. Its business strategy is shifting toward cleaner, more sustainable energy, without compromising its strong operations in the oil and gas industry. Also Reliance partner with global industries to obtain technologies in the new energy space for building end-to-end integrated renewable energy manufacturing facilities, including projects for green hydrogen, green chemicals and energy storage.
Affordability will be the crucial focus for the oil and gas industry to guarantee access to energy for all while preserving economic stability. The industry is challenged by unstable global oil prices, high operating costs, and investments in new technologies. This demands strategic planning and innovative approaches to balance these factors. The Abu Dhabi National Oil Company (ADNOC) supplied crude oil on a delivered at port (DAP) basis to Indian refiners such as Indian Oil Corporation, Hindustan Petroleum Corporation, and Bharat Petroleum Corporation. This approach facilitates refiners to manage costs effectively when freight rates escalates and during supply uncertainties.
Kumar Singh, MD & CEO of Petronet LNG said, “Unaffordable prices will force consumers to switch over to other fuels, and it’s imperative to calibrate it carefully so that high prices do not end up destroying demand.”
A key business strategy for ensuring cost optimization is achieved through streamlined operations, technological advancement, and effective supply chain management. Investing in the companies which aim to decrease the cost of production without damaging the quality of energy produced while making it accessible to the consumers, government policies and subsidies at stake to keep prices stable. According to International Energy Agency (IEA), India accounts for more than one-third of global oil demand growth in 2023-2030 forecast period. Investment in alternative fuels like natural gas, biofuels, and renewable energy reduces dependence on traditional sources of fuel. The alternatives are generally cheaper to produce also in line with the global sustainability objectives. Affordability ensures that energy remains a driver of economic growth and social development which is necessary for the future of the oil and gas industry.
Anil Agarwal, Chairman, Vedanta said, "With 75 percent of our oil reserves still unexplored, India can unlock its true potential with the help of global companies. They have cash reserves worth $3 trillion and are looking for investment opportunities."
Oil and Natural Gas Corporation (ONGC), has used the cost-effective approach to maintain its leadership in this industry. ONGC focuses on improving efficiency and reducing operational costs through advanced technology, including digitalization and automation. In addition, ONGC aspired to share exploration risk through joint ventures and partnerships while optimizing resource use and reducing the costs of developing new oil and gas fields.
The uninterrupted availability of energy system protects country and global interests from geopolitical uncertainties, market fluctuations, and natural disruptions. The way towards energy security lies in the diversification of sources. Energy dependency will decrease if countries use multiple suppliers and invest in domestic exploration. Developing strategic budgets allows the country to handle supply disruptions efficiently when emergencies arise. For instance, Prime Minister Narendra Modi announced Guyana as strategically important for India’s energy security because India will be purchasing two million barrels of crude oil from the South American country. With substantial offshore oil reserves, Guyana is all set to emerge as one of India’s crucial partners for diversifying its oil imports.
Hardeep Singh Puri, Union Minister for Petroleum and Natural Gas said, "Despite geopolitical tensions in some parts of the world, there is no shortage of crude oil in the world. Consuming countries have several options to choose from".
Energy security is one of the major concerns requiring companies to ensure a reliable and strong supply chain. The different business strategies to address energy security are diversification of energy sources, building strategic reserves, and securing of long-term supply contracts. The other key strategy would include investing in oil and gas infrastructures, such as pipelines, refineries, and storage facilities that contribute to minimizing interruptions in the supplies. This further includes a significant partnership with the governments and international associations that are essentially required for staying in regulatory agreement and securing from geopolitical risks.
Ambassador Virendra Gupta, Co-Chairman, CII Core Group on Energy Security said, “Energy security is about ensuring supply at affordable costs, not just owning assets abroad”.
The strategic initiatives ensure that companies secure energy supply without increasing vulnerability. Integration of renewable energy into the supply mix would further ensure long-term energy security since demand for cleaner alternatives continues to increase. Indian Oil Corporation (IOC) has developed a strategic approach to secure energy supply through strategic investments in infrastructure and diversified sources of energy. IOC has extended its refinery network, pipelines, and storage facilities for the efficient transportation and supply of oil and gas. IOC has secured long-term contracts for crude oil originating from several, reducing its dependence on a single source and ensuring a consistent energy supply. To ensure stronger energy security, IOC also invests in alternative energy sources such as biofuel and electric vehicle charging stations.
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