The Union petroleum ministry brass, who supervise imports of close to 60 million tonnes of crude and petroleum products into the country every year, hotly fend queries on oil supplies, snapping, "please understand, oil purchases are commercial transactions, there is no government aid involved."

Oil imports are funded through external commercial borrowings (ECBs), the upper limit of which was raised last year to $2.9 billion. Canalising agency Indian Oil Corporation syndicates180-day credits through an arranger, that taps both overseas banks and the FCNR accounts of banks in India. With or without the Glenn Symington prescriptions, therefore, US banks could not prevent India from purchasing oil abroad.

Oil imports directly or indirectly account for 75 per cent of the home consumption of petroleum and oil lubricants. Yet petroleum ministry brass monitoring imports, scarcely betrayed any signs of concern after the Pokhran blasts and the onslaught of international rebukes it brought in its wake.

The national elections earlier this year, had prompted the ministry to set up a special task-force to monitor oil supplies. The panel earned a fresh lease of life in March, when the centre decided to ensure that oil supply slips did not disrupt harvesting. In the last two weeks when US, Japanese, Canadian and German banks began to refuse to credit to their Indian counterparts and put the home industry on edge, the only sign of restlessness within the Oil Coordination Committee (thatmonitors supplies and distribution) were the frequency of meetings.

The panel could afford to "wait and watch" the situation, since most of the country's 20 million tonnes of petroleum products imports are sourced from the Gulf, a part of the world that has little reason to sympathise with bullying by the West. Most of the crude imports are also sourced from West Asian nations, primarily Saudi Arabia, Kuwait, Iran, the United Arab Emirates and Iraq.

Sweet crude, which accounts for less than a fourth of the total imports, usually comes from Nigeria. Some amount of oil is also procured from South East Asian countries like Malaysia.

The tremendous spurt in oil consumption and so imports, in the fag end of the 1996-97 fiscal, compelled the centre to raise canalising agency Indian Oil Corporation's ECB limit twice between January and March last year. Indian Oil's overseas borrowing capacity first went up to $1.9 billion from $1.5 billion and then finally to $2.9 billion.

By April last year Indian Oil hadexhausted $2.2 billion of its ECB limit. This month the company's borrowings for its oil imports are estimated to be close to $2.5 billion. Much of that increase really reflects the nearly nine per cent increase in crude imports by newly commissioned refineries last year, rather than any panic buying of petroleum products, to ward of international sanctions.

The real reason for complacence within the oil industry is the nearly stagnant prices of Dubai and Brent crude, since the first spurt in oil prices after Opec (Organisation of Petroleum Exporting Countries) announced a cut-back in output at the end of March this year. Dubai crude prices have hovered around $12 a barrel since April, after the initial climb from roughly $10 a barrel in the middle of March.

Brent crude prices on Friday touched $14.28 a barrel, which was $1 more than at this time last month, but still way below the $18 a barrel price that the Opec has been hoping for. A first indication of the way oil prices will move at home came fromthe 15 paise drop in diesel prices this month. The oil price plateau is being aided by a declining growth in oil consumption within the country. During the peak season, that is now coming to a close, the growth in demand from oil guzzlers like industry and the farming community, has been much less than the 6.5 per cent estimated initially. The offtake of petroleum products usually declines during the rains, expected in July, only to pick up again in winter.

"Instead of stoking panic," snapped an irate oil industry brass, much harangued by scribes, "why don't you write that diesel prices have come down and the taming impact that will have on inflation?" A thought that should bring solace to the oil consumer at home.