Brazil expects OPEC membership talks in Saudi Arabia in July

New Delhi (Reuters) – Brazil will start talks on joining the Organization of the Petroleum Exporting Countries in July in Saudi Arabia, but does not expect to achieve membership this year, Brazil’s energy minister said on Wednesday during a visit to India.

Brazil’s far-right president mooted the idea of joining the producer group in October.

But the proposal was greeted with scepticism as officials questioned whether the country, which last year became a net exporter, would be willing to comply with OPEC supply curbs.

Following a meeting with Indian oil minister Dharmendra Pradhan, visiting Brazilian energy minister Bento Albuquerque told Reuters he would travel to Saudi Arabia in the middle of the year when talks could begin.

“Saudi Arabia holds the presidency of the G20. I will be there in July, then we can start discussion,” Albuquerque said, adding he did not expect membership this year.

Asked if his country would be willing to cap output, Albuquerque said it was “a matter of negotiations”.

Albuquerque, who is in Delhi ahead of the state visit of President Jair Bolsonaro at the end of this week, said Brazil’s oil exports in 2020 are expected to rise to about 1.4 million barrels per day (bpd) from 1.1 million bpd last year as the nation’s crude production jumps 13% to 3.5 million bpd.

During Bolsonaro’s visit, India hopes to sign agreements including a Memorandum of Understanding for cooperation in the oil and natural gas sector, a statement said on Wednesday.

India, the world’s third biggest oil consumer and importer, which imports more than 80% of its needs, usually relies on the Middle East for most of its supply.

But its imports from that region fell to a four-year low last year as the nation diversified its sources to protect itself from geopolitical risks.

“India is diversifying its crude oil supply and our oil companies have expressed interest in sourcing more crude from Brazil, if offered favourable commercial terms,” Oil minister Pradhan tweeted after meeting Albuquerque.

Pradhan said he also sought early monetisation of India’s existing investments in Brazilian energy sector. India’s ONGC Videsh Ltd, and Bharat PetroResources have stakes in some exploration blocks in Brazil.

India wants its top refiner Indian Oil Corp and other state refiners to sign annual oil import deals with Brazil, an oil ministry source said.

In 2019, India’s oil imports from Brazil declined by 23% to about 47,000 bpd, tanker data obtained from industry sources showed.