In 2021, the oil and gas industry in India has an arduous task of helping the economy revive quickly, while negotiating the headwinds of global recession, protectionism and geo-political upheaval. Positive signs of recovery and growth were visible in the fourth quarter of 2020, as fiscal and monetary stimuli provided by the government got translated into enhanced government and private expenditure.
Further, the oil industry will steer its drive towards universal accessibility, availability and affordability while adopting de-carbonisation and digitalisation. The oil and gas industry, in the public, private and joint sectors, is ready to welcome 2021 with resolve of a service industry, armed with resources of the mining industry and technology of the IT industry.
Indian oil and gas industry leaders are faced with the twin challenge of responding to the changing environment, while managing their enterprise level shake-up and internal resources, including human resources
Demand for oil and gas is relatively price inelastic and much more responsive to shifts in trend regarding income, and by extension, fiscal stimulus, tax incentives and other economic drivers; all these will play out in 2021.
The volume of oil and gas consumption in 2021 is estimated to bounce back to 2019 levels (Graph 2). The consumption in 2020 witnessed a slump of 10 per cent and 2021 will recover by 12 per cent, displaying V-shaped recovery.