Page 5 - Policy Economic Report - April 2023

Policy and Economic Report:
Oil & Gas Market

major component of the reserves, decreased by USD 2.146 billion to USD 514.489 billion, according to the
Weekly Statistical Supplement released by the RBI. Further, gold reserves dropped by USD 24 million to
USD 46.151 billion. The Special Drawing Rights (SDRs) were up by USD 19 million to USD 18.431 billion,
the apex bank said.

According to provisional data released by the Ministry of Commerce, India’s overall exports (Merchandise
and Services combined) in March 2023 are estimated to be USD 66.14 Billion, exhibiting a negative growth
of (-)7.53 % over the same period last year. Overall imports in March 2023 are estimated to be USD 72.18
Billion, exhibiting a negative growth of (-) 7.98 % over the same period last year.

As far as oil and gas sector is concerned, recently announced OPEC+ supply cuts aggravated an expected
oil supply deficit in 2H23 and boosting oil prices at a time of heightened economic uncertainty, even as
industrial activity slows in the world’s largest economies and production growth outside the alliance
appears robust. The bloc’s self-described “precautionary move” immediately triggered a jump in North
Sea Dated crude from March lows.

Following the production cuts announcement by OPEC+, oil prices accelerated in April 2023, however, the
prices have soon retreated amid concerns of global recession and high interest rate environment. The
Federal Reserve and European Central Bank are expected to raise interest rates again, fueling concerns
that tightening financial conditions could dampen global growth and hurt energy demand.

Natural gas spot prices at the U.S. Henry Hub benchmark averaged $2.31 per million British thermal units
(MMBtu) in March 2023 as compared to $2.38 per million British thermal units (MMBtu) in February 2023.
Natural gas prices started to decrease as high inventories of natural gas is available to meet the demand
of the consumers plus lower than usual withdrawal rate contributed to sluggish demand for natural gas.

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