Davos 2026: Ample crude supply keeping oil prices stable despite geopolitics, says IOC’s A S Sahney | Exclusive

Global crude oil markets continue to remain well supplied despite ongoing geopolitical tensions, keeping prices largely stable, A S Sahney, Chairman of Indian Oil Corporation, told CNBC-TV18 on the sidelines of the Davos World Economic Forum 2026.

“Yes, supplies are there, and supplies are in ample quantity as of now,” Sahney said, noting that despite wars and disruptions, crude prices have largely hovered around the $60 per barrel mark. “Given everything, all the geopolitical issues, every disturbance, every war going on, and still crude hovering at around $60 or thereabouts, it shows that we have a good supply of crude oil.”

He added that geopolitics is the key factor preventing oil prices from falling further. “If these wars are taken out, if the geopolitical situations subside, I am very sure that it is going to be below $60,” Sahney said.

Refining margins, he said, are currently providing support.

“For diesel, it is hovering at around $18–19 and for MS it is hovering at around $10–12, which is a decent place to be,” Sahney said, adding that with crude prices in the $60–64 range, Indian Oil is “able to manage a proper bottom line.”

On Venezuelan crude, Sahney said, “Any new crude is welcome,” he said, but added, “I personally feel that it is not very soon that we will see those crudes on Indian shores… because it leads to a lot of investments there to bring up the crude in Venezuela.”

Currency pressure, efficiency drive and subsidies

Sahney acknowledged that the falling rupee has negatively impacted profitability, given Indian Oil’s heavy reliance on dollar-denominated crude imports. “Every depreciation has its effect on our profitability, because we are buying in dollars and selling in rupees,” he said, calling the impact on the bottom line “negative.”

To counter this, Sahney said Indian Oil has embarked on a company-wide transformation focused on efficiency. “I am working on improving the efficiencies of my refineries, improving the efficiencies of my supply chains, improving the efficiencies of how the whole ecosystem is working,” he said, adding that these measures would support profitability structurally rather than quarter to quarter.

“This will be a different Indian Oil going forward,” Sahney said. “I’m not talking about quarter to quarter. I’m talking about year on year—I am going to be much, much better than where we were.”

On concerns around a possible excise duty hike, Sahney said there is no indication at present. “As of now, that much I can say,” he said, adding that pump prices are influenced more by refining cracks than crude prices alone, cautioning against a simplistic link between crude levels and retail fuel prices.

On LPG subsidies, Sahney said the government has provided the industry with a ₹30,000 crore support package, of which half has already come to Indian Oil. “It is being given to us on a monthly basis,” he said, adding that payments began in November 2025 and will continue till October 2026, giving the company clear visibility on support over the next year.

Energy transition and outlook


On clean energy, Sahney said returns from renewables remain lower but stable. “Solar and wind give me around 13–14% return on equity… which is on the lower side, but it is a sustained return for 25 years once I have invested,” he said.

He said Indian Oil is expanding into compressed biogas, ethanol, including second- and third-generation ethanol and green hydrogen. “Today, Indian Oil is putting up the biggest green hydrogen plant in India - 10,000 tonnes per annum - at Panipat,” Sahney said, adding that it is expected to be ready by December 2027.

Sahney also said Indian Oil is currently the only company in India certified to produce sustainable aviation fuel (SAF). “By May or June, I will be ready to dispense sustainable aviation fuel,” he said, ahead of the blending mandate.