Crude oil prices rose sharply on Thursday, inspired by OPEC's decision to stand firm on supply cuts that have doubled prices this year. World Benchmark Brent crude blend leapt 89 cents higher to last trade at $23.82 a barrel in London, just seven cents off from a new high of $23.89, a level not seen since January 1997.

About 60 per cent of India's oil requirements are met through imports and in April-June 1999, the country spent $2.03 billion. The oil import bill for this period showed a nearly 54 per cent rise over the $1.32 billion spent in the corresponding period last year.

India's dependence on imported productswill reduce in the next two years as local refineries get commissioned, Dhingra said. The petroleum ministry has estimated the country's crude oil refining capacity will match its petroleum product demand in 2001-2002 (April-March).

"Our imports should slow down to a trickle in the next financial year, that is 2000/2001," Dhingra said. "We'll probably end up being balanced to may be marginally deficit, depends on how the new refiners can perform in their initial months of capacity utilisation," he said.

Dhingra said he expected a sharp hike in the prices of domestic petroleum products soon. India follows a cross-subsidy system for key oil productslike kerosene and liquified petroleum gas (LPG), which are sold under an administered pricing system.