New Delhi (Sputnik) – Millions of Indians could soon be buying gasoline and diesel from global oil majors as British Petroleum will soon set up 3,500 retail outlets and Russia’s Rosneft will seal a deal to purchase a 49% stake in Essar oil by the end of this October.
Essar is India’s second largest private refinery. Rosneft is likely to enter the Indian retail market with 2,000 retail outlets currently owned by Essar. The Rosneft Board is expected to approve the $6.5 billion transaction next week.
On 26 August this year, Sputnik reported that notwithstanding the pressure being exerted by the US indirectly to scupper the initiative, the Indian and Russian energy firms will go ahead with the deal. The US had included Rosneft on its sanctions list, accusing Moscow of involvement in the military conflict in Eastern Ukraine.
The deal will shake-up India's retail sector, according to Energy Expert Narendra Taneja.
"Entry of global majors in Indian market will change the picture of the retail sector completely. Consumers will be the major beneficiaries of these developments as new companies will bring new practices with highly efficient products into the retail sector," said Taneja.
Apart from Rosneft and BP, France's Total and Saudi Aramco are also keen to break into the Indian retail market. According to an estimate by International Energy Agency, oil consumption in India is expected to reach to 10 million barrels per day in 2040 from today's 6 million barrels. Last year, Indians purchased more than 24 million new vehicles. Looking at the current GDP growth rate, increased purchasing power may boost the sale of vehicles in the future.