NEW DELHI: The Union Cabinet on Wednesday approved the deregulation of the sale of domestically-produced crude oil. The move is expected to boost government revenues and the profits of oil producers.
The decision will come into effect from October 1, 2022.
The decision will give more marketing freedom to Exploration and Production Operators, Union minister Anurag Thakur told media persons here.
Oil producers will now have the liberty to sell the oil in Indian markets but exports of domestically-produced crude will not be allowed.
At present, the Centre decides the quantity of crude oil to state-run refinery from each producer.
The government revenues will be calculated on uniform basis for all the contracts.
“In the last eight years, government has taken various steps and reforms in the exploration and production sector. Various steps have been pricing and marketing freedom, discovery of gas price through bidding, etc,” the government said.
Since February 2019, reforms have been focused on maximum production with least revenue sharing.
Companies like ONGC and Oil India had been demanding to deregulate the prices for a long time.