Strike hits India's fuel supply, delays flights

India's energy supply was squeezed further and flights delayed at the country's busiest airport as a strike by officials at state-run oil companies that dominate domestic fuel supply entered a second day.

Strike hits India's fuel supply, delays flights
Unions leaders representing firms such as refiner Indian Oil Corp (IOC) and explorer Oil and Natural Gas Corp said, no solution was in sight for the strike over higher wages that has cut natural gas supplies by a third and reduced output at refineries and oilfields.

"The government is very adamant. The minister is not willing to meet us," said a spokesman for the union, which is demanding a pay increase for the 55,000 employees it represents.

Unions have called strikes frequently in recent years but this is first time it has actually hit supplies. More than a dozen flights were delayed by 30-45 minutes at Mumbai's airport, where aviation fuel operations are handled by state-run IOC, Bharat Petroleum Corp and Hindustan Petroleum Corp, said airport spokesman Manish Kalghatgi.

"Some airlines are trying to organise supplies from private firms," he said.

The Mumbai airport, the country's busiest, handles an average of more than 300 flights daily at its domestic terminal.

The Times of India reported that several petrol stations in New Delhi were on the verge of running out of stock.

As the stoppage bites, Oil Minister Murli Deora's announcement the government was planning to cut fuel prices again could encourage gas stations to reduce inventories and top up their tanks only after prices are cut.

On Wednesday, the first day of the strike that would last for an indefinite period, Petroleum Secretary R.S. Pandey said ONGC's crude oil output had fallen by nearly a quarter to 270,000 barrels per day (bpd). IOC's refineries were operating at 30 percent below the normal rate.

Oil industry officials said supplies had fallen further but were unable to estimate the overall impact on fuel supply.

A director in a refining company said it was too early for the strike to have any impact on India's crude imports, which account for about 70 percent of the oil India consumes.

Operations at private refiners Reliance Industries and Essar Oil were normal and officials say the government may turn to them for supplies if needed.

Despite the impact on production, Indian refiners have not yet shown any need for fuel imports.

Reuters
Last Mod: 08 Ocak 2009, 14:07
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