Global Outlook
The world stands on the brink—battered by relentless wars and crumbling alliances. Institutions are faltering, and the remaining pillars of stability are beginning to tremble under mounting pressure. The old rules have collapsed, and the fires of conflict burn without restrain. One more push - and the fragile dam holding back chaos bursts. Just as the world economy had begun to recover from the twin shocks of COVID and the Russia-Ukraine crisis, fresh unrests threatened to derail its fragile stability once again. The latest escalation wasnt new—it was a long-simmering shadow war that had finally broken into the daylight. With the world facing this wide spectrum of ongoing conflicts, the current weakness of the multilateral framework is alarming. Institutions that once kept order now stand paralyzed as conflicts multiply and trust evaporates.
As protectionism and populism surge, nations are pushed toward isolation. To avoid a fragmented, conflict-ridden future, countries must forge pragmatic alliances grounded in shared interests and resilience. History has shown it time and again: after every fall, humanity finds the strength to rise—not just to recover, but to rebuild stronger than before. Crisis shakes the world, but courage rallies it back to its feet.
1. Global Economy_
Balancing Recovery with Inflation and Fragmentation
Though the global economy has shown striking resilience in enduring recent upheavals, yet it remains deeply scarred. Sanctions, tariffs, and creeping protectionism—once outliers—now anchor a fractured system. Emerging markets and developing economies, already hamstrung by scarce fiscal resources and fragile institutions, stand alarmingly vulnerable to these escalating threats. These persistent fault lines severely hamper any hope of a robust recovery, as new currents of uncertainty loom ominously on the horizon. Earlier this year, markets faced turbulence as investors grew wary of unpredictable tariff policies and potential threats to the U.S. dollars dominance as the global reserve currency. These anxieties drove a rally in gold as a safe haven and sparked an unusual simultaneous sell-off in U.S. equities, bonds, and the dollar in April—a rare trifecta of weakness. The recent escalation of tariffs signals a deepening trade conflict, with the U.S. cautiously imposing measures on its trade partners and other nations. Retaliatory actions are already impacting industries and markets. Over 2022-24, the number of new restrictions implemented on trade in energy, metals, and food commodities was more than ten times the corresponding number in the three years before the COVID-19 pandemic.1 Although many planned tariff
increases are currently paused, the mix of implemented measures and retaliatory actions has driven US and global tariff rates to their highest levels in a century.
The potential economic fallout is concerning: global trade may contract, production could weaken further, and inflationary pressures might intensify. Although some tariffs are on hold pending negotiations, the situation remains delicate, with uncertainty and market instability posing significant risks. If trade tensions escalate or uncertainty deepens, overall demand for commodities could weaken, possibly driving prices down further. Commodity prices are expected to fall by 12% in 2025 and another 5% in 2026.1 If these forecasts materialize, they would mark the end of the post-pandemic and post-invasion period of elevated, inflation-adjusted commodity prices. Such sustained declines could signal a significant shift in global commodity markets, carrying wide-ranging consequences for producers, exporters, and economies reliant on commodity trade. Retaliatory tariffs, if enacted, could reduce global merchandise trade growth by 0.6 points in 2025, with trade policy uncertainty potentially cutting it by an additional 0.8 points, risking a total 1.5% decline and severely impacting least-developed nations.2 Strengthening the global economy calls for a resilient, rules-based trade system that ensures fairness and transparency while addressing persistent challenges, including the rising use of non-tariff barriers and distortive practices. Over the past three decades, open markets have driven trade, enhanced productivity, and improved affordability, significantly reducing extreme poverty from 40% in 1995 to below 11% in 2022.3
The economic outlook hinges on the duration of recent trade measures, the potential for further retaliatory or escalatory responses by trade partners, and the extent to which current policy uncertainty persists. At present the global economy is stuck in a cycle of sluggish growth and mounting debt. As financial weaknesses and government debt amplify one another, the systems ability to hold steady is facing its most severe challenge to date. Sustained sluggishness in global investment growth undermines long-term economic potential. Inflation, having retreated from decades-high peaks, experienced a steady yet uneven decline, gradually approaching central bank targets. It is expected that the Central Banks will likely keep cutting interest rates in coming quarters, but at varying speeds. Central banks slammed the brakes on their most aggressive tightening cycle in decades, finally shifting gears in mid-2024. The easing cycle has resulted in varying interest rate levels across major economies: Canadas rate stands at 2.75%, while the US Federal Reserve maintains 4.5%, the Bank of England 4.25%, and Indias Reserve Bank 5.5%—reflecting differing monetary policy approaches.4
Most economies face a steeper slowdown than in 2024. In such volatile times, the global economy wont wait for calm—only those who act boldly, adapt swiftly, and lead with resilience and innovation will thrive. The World Bank cautions that global economic growth is expected to fall to just 2.3% in 2025, hindered by rising trade barriers and persistent policy uncertainty.5 According to the International Monetary Fund (IMF), global growth decelerated to 3.3 per cent during 2024 from 3.5 per cent during_2023._Growth is now projected at 2.8% in 2025, followed by a modest rebound to 3.0% in 2026.6
2. Global Energy Sector
Ensuring Energy Security and Sustainability
The global energy system didnt just grow in 2024—it shifted gears. Energy demand jumped 2.2%, well above the past decades sluggish 1.3% average.7 Yet, demand still lagged behind global GDP growth of 3.2%, revealing deeper structural shifts—signalling improved efficiency and a shift toward less energy-intensive sectors. Emerging and developing economies drove over 80% of the surge, with every fuel and technology seeing gains. Oils long-standing grip began to break. For the first time in modern history, oils share of global energy demand plunged below 30%, down from a towering 46% peak in the 1970s. This wasnt a dip—it was a seismic shift.7 Clean energy is rising fast, and the age of fossil fuel dominance is rapidly losing steam. The OPEC+ alliance, once the worlds energy kingmaker, found itself outflanked. Even coordinated production cuts couldnt prevent Brent crude from crashing to $65 a barrel—a five-year low that exposed the cartels weakening grip. U.S. shale producers seized the moment, pumping a record 13.3 million barrels per day.8 Meanwhile, massive offshore projects from Guyana to Namibia, throwing fresh barrels into already saturated markets. The old guard wasnt just being challenged—it was being outpaced. The Trump administration has pushed to sustain global reliance on fossil fuels—oil and gas—that have powered industrial growth for over a century. As the worlds top oil producer and leading natural gas exporter, the U.S. is pursuing what Trump called "energy dominance,". The Red Sea became a warzone in 2024. Houthi missile strikes forced 30% of global tanker traffic to detour around Africa, sending shipping costs soaring and exposing just how fragile the worlds oil lifelines really are. Europes desperate pivot from Russian gas turned the U.S. into an energy superpower overnight. American LNG exports hit a staggering_ 13 billion cubic feet per day_ (EIA), rewriting global trade maps. The Atlantic is now the worlds most critical energy corridor. Global energy prices have also moderated, with oil prices on a downward trend after the highs of 2022. Yet geopolitical risks persisted, and some markets remained exposed to volatility.
Global renewable power capacity grew by approximately 700 gigawatts (GW) in 2024, marking a record-breaking increase for the 22nd year in a row.7 This surge, combined with an expansion in nuclear energy, meant that low-emission sources contributed around 80% of the global rise in electricity generation. While clean tech costs have declined rapidly, the sector remains vulnerable to supply chain disruptions, inflation, and financing pressures, successful clean energy transition hinges on the pace at which low-carbon technologies achieve cost parity with fossil-based alternatives.
In 2024 and 2025, the global energy landscape turned into a battleground for a fierce "tech–minerals–energy trinity war." At the heart of this battle lies the race to secure critical minerals essential for both the green energy transition and the digital economy. The U.S.-China clean energy cold war escalated dramatically as Washington slapped tariffs on Chinese solar panels and EVs while Beijing weaponized its control of 80% of rare earths processing (IEA). The AI revolution is colliding with energy realities. Data centers—AIs physical infrastructure—already devour_1.5% of global electricity (415 TWh in 2024), with demand projected to_ triple by 2030_ as adoption explodes.9 This creates a paradox: the same technology promising societal transformation threatens to_ overwhelm power grids and amplify emissions_unless clean energy scales equally fast. The numbers dont lie: 2024 shattered records with CO2 emissions hitting 37.8 gigatonnes—another all-time high—while atmospheric CO2 concentrations surged to 422.5 ppm, now 50% above pre-industrial levels.7 This isnt some distant threat; its fuelling disasters in real time. Had 2024s weather simply matched 2023 (itself the second-hottest year ever), half of this years emissions spike could have been avoided—proof that climate feedback loops are already rewriting the rules.
The 29th Conference of the Parties (COP29), held in Baku, Azerbaijan, delivered mixed results with a landmark but contentious climate finance agreement. The key outcome was the adoption of the New Collective Quantified Goal (NCQG), committing developed countries to mobilize at least $300 billion per year by 2035 to support climate action in developing nations, tripling the previous $100 billion goal from COP15. However, this fell short of the $1.3 trillion annually demanded by developing countries like India, Nigeria, and Bolivia, who criticized it as inadequate for failing to address their climate challenges. Yet, theres a silver lining: emissions grew slower (0.8%) than the global economy (+3.2%), showing tentative decoupling. But with 300 million extra tonnes of pumped into the
CO2
atmosphere—driven partly by record heat—the math remains grim. Every fraction of a degree matters, Were past "wake-up calls." This is a live crisis—one where delays arent just costly, but catastrophic.
Oil Prices & Demand
From Cuts to Conflict: Why Oil Stability Remains Elusive
Oil economist Fatih Birol, recently remarked, "Oil markets today are walking a tightrope — caught between geopolitical instability, fragile demand recovery, and production restraint. The age of predictable oil is over". Oil remains the worlds most volatile and strategically disruptive commodity—a single geopolitical shock, supply disruption, or demand swing can send prices spiralling, with ripple effects across the global economy. Unlike other markets, oils deep ties to national security, inflation, and energy policy amplify its turbulence, turning price swings into systemic risks. The reality is that oils grip wont loosen until alternatives scale sufficiently, and that timeline keeps getting pushed further into the future.
Global oil markets surged after Israels airstrikes on Iran and Tehrans retaliation, sparking fears of broader regional disruptions. Although Iranian oil flows remained unaffected, concerns over potential supply bottlenecks in the Strait of Hormuz pushed Brent crude to a six-month high of_$74/bbl. However, the_geopolitical risk premium quickly faded_once it became clear that Iran would not escalate tensions further in response to the U.S. bombing of its nuclear sites. Despite these short-term fluctuations,_JPMorgan and agencies like the EIA maintain their baseline projection_for Brent crude in 2025, expecting prices to remain in the_low-to-mid $60 per barrel range. Oil prices may increase if policy efforts to ease trade tensions lead to stronger-than-anticipated global demand. Between April 2024 and June 2025, oil prices saw sharp swings driven by geopolitical tensions and shifting supply-demand dynamics. Brent crude peaked near $93 in April 2024 amid Middle East unrest but Saudi Arabias shock decision to unwind production cuts in May 2025 sent Brent crude crashing below $65 - a four-year low that exposed the OPECs new brutal calculus:_better to flood the market now than lose control forever. The era of production restraint is over. OPEC+ would rather challenge competitors than watch its influence fade, aggressive volume competition will test the survival of higher-cost producers.
OPEC+ is implementing production cuts totalling_ 5.86 million barrels per day (bpd)—roughly_ 5.7% of global demand—through a series of phased reductions agreed since 2022. These measures aim to stabilize the market amid ongoing uncertainty surrounding global oil demand. In 2025, OPEC+, led by Saudi Arabia, accelerated the unwinding of its 2.2 million barrels per day (bpd) voluntary production cuts, originally set to phase out gradually from April 2025 to September 2026. The group increased output by 138,000 bpd in April, followed by 411,000 bpd hikes in May, June, and July, and a larger 548,000 bpd boost in August. Sources indicate a planned 550,000 bpd increase for September, aiming to fully reverse production by September 2025, a year ahead of schedule.
This evolving demand landscape comes at a time when, the oil market remains in a prolonged cycle of surplus largely due to booming North American production over the past decade. The market remains in a state of oversupply despite OPEC+ efforts to stabilize it.
Global oil demand is entering a critical inflection point, with growth set to slow dramatically before peaking at 105.5 mb/d by 2030. Strong oil demand growth in emerging and developing economies—projected at_4.2 million barrels per day (mb/d)_from_2024 to 2030—stands in sharp contrast to the ongoing decline in advanced economies.10_ Asia drove nearly all the growth, with India accounting for a 1 mb/d increase - the largest of any country - underscoring how emerging economies now steer global oil markets. World oil production capacity is projected to grow by 5.1 million barrels per day (mb/d) to reach 114.7 mb/d by 2030. This expansion will dramatically outpace the anticipated 2.5 mb/d increase in global oil demand over the same period. EV sales exceeded 17 million in 2024 and are projected to surpass 20 million in 2025, accounting for roughly one-quarter of all cars sold worldwide. The electric vehicle revolution is accelerating this structural change, with EVs projected to displace a substantial 5.4 mb/d of oil demand by 2030 - equivalent to the total production of a major OPEC producer like Iraq.10 As traditional demand pillars weaken, petrochemicals are emerging as oils last growth frontier, projected to consume 18.4 mb/d (17% of global supply) by 2030, driven by massive NGL-fed capacity expansions in China and the U.S. In recent years, the U.S. has seen the largest growth in NGL (natural gas liquids) production compared to other supply sources. This surge has facilitated significant rises in LPG and ethane consumption by petrochemical industries in both the U.S. and China. Between 2019 and 2024, consumption of oil-based feedstocks rose by an estimated 2.3 mb/d.
In 2024–2025, global energy policy continues to accelerate the shift toward cleaner technologies. Major economies—including the U.S., EU, and Canada—have implemented stricter emissions standards for vehicles, reinforcing the transition to electric mobility. These regulatory moves are supported by large-scale industrial incentives such as the U.S. Inflation Reduction Act, the EUs Net-Zero Industry Act, Chinas 14th Five-Year Plan, and Indias PLI scheme. Together, these initiatives are driving investment in renewables, EVs, and green manufacturing, solidifying policy-driven momentum toward a lower-carbon future In 2025, the oil industry is navigating a pivotal transition. Major producers are responding by diversifying into renewables, hydrogen, and carbon capture, positioning for a lower-carbon future. Yet, with global supply projected to exceed demand by 2030, the industry also faces near-term risks of overcapacity, price pressure, and consolidation. The coming years will be critical as oil companies balance maintaining supply with accelerating transformation.
Gas & LNG:
Drivers of Gas and LNG Price Dynamics
After the 2022–2023 supply shocks, natural gas markets rebalanced and returned to growth in 2024. According to IEA, Global gas demand hit a record high in 2024, with preliminary estimates showing a 2.7% increase—equivalent to around 115 billion cubic meters (bcm), with global demand reaching a new record—over 75% of which came from emerging and developing economies.7 Emerging and developing economies in Asia drove roughly 40% of the global increase in natural gas demand, fuelled by sustained economic growth. This strong increase was primarily driven by China and India. Chinas gas demand grew by over 7%, while Indias demand increased by more than 10%, supported by expanding gas infrastructure. In 2024, the European Union saw a modest 1% rise in natural gas consumption. However, gas demand for power generation dropped by approximately 5%, even as overall electricity demand grew by about 1.5%. This sharp decline in gas-fired power production was mainly due to a significant surge in renewable energy generation.7 World Bank predicts that after a strong surge last year, global natural gas consumption growth is expected to slow to around 60 billion cubic meters (bcm) in 2025 before rebounding to 110 bcm in 2026, led by rising demand in Asia Pacific and the Middle East. Meanwhile, consumption in Europe and North America is likely to remain flat.1 In 2025, supply growth is projected to outpace demand, but the trend will reverse in 2026, with demand slightly exceeding supply. Next years production increase will be evenly distributed among the four key regions—Asia Pacific, Eurasia, the Middle East, and North America. By 2026, Qatars major capacity expansion is expected to contribute nearly half of the global supply increase of 110 bcm. Over the next two years, rising LNG exports from North America and Qatar will account for most of the growth in global trade. The World Bank natural gas price index is forecast to rise sharply in 2025 and remain relatively steady in 2026.
In 2024, U.S. natural gas production remained stable despite low prices, bolstered by associated gas from increased oil production. The U.S. continued to lead as the worlds top LNG exporter, with non-EU markets accounting for 50% of shipments, up from 40% in 2023. Chinas LNG imports approached the record levels of 2021 (79 mmt), while Europe and the U.S. experienced significant inventory drawdowns in late 2024 and early 2025, tightening markets. EU storage entered winter near historic highs but saw sharper seasonal declines due to early withdrawals compared to previous years.1 These shifts underscore evolving global trade patterns driven by geopolitics and regional demand changes.
U.S. benchmark Henry Hub natural gas spot price averaged $2.20 per million British thermal units (MMBtu), marking the lowest annual average in inflation-adjusted terms ever recorded.8 This represented a 16% decrease from the 2023 average and a 68% drop from 2022, constituting the largest two-year decline on record.
Natural gas demand is becoming increasingly sensitive to weather fluctuations, such as cold snaps and heatwaves. As climate change fuels more frequent extreme weather events, gas-fired generation is playing a growing role in power systems with high shares of variable renewable—acting as a critical backup to maintain electricity reliability when wind and solar output fall short. Comment: already covered in initial para.
However, heightened geopolitical risks and shipping bottlenecks continue to underscore the vulnerability of global gas supply routes in 2025. Recent security threats – most notably a series of attacks on merchant ships in the Red Sea and Gulf of Aden amid Middle East tensions – have led many major shippers to reroute vessels carrying LNG and other cargoes away from traditional chokepoints.
Ultimately, while 2025 is poised for growth in gas demand and a recovery in pricing, it is also a year where security-of-supply concerns remain front and center, influencing how and where natural gas is transported globally.
Exploration
Shifting Sands: Exploration Trends in Oil and Gas
Rystad Energys 2024 analysis reveals a compelling contradiction in global oil and gas licensing: while the number of awarded blocks surged by 50% to over 1,050, total licensed acreage actually decreased by 33% compared to 2023s 450,000 square kilometers.11 This "smaller but more" approach is reshaping exploration strategies, with offshore blocks shrinking to an average 474 square kilometers (down from 865) and onshore blocks contracting dramatically to just 372 square kilometers (from 1,143). Two transformative trends are driving this shift: frontier exploration continues its decline, accounting for only 31% of awarded acreage compared to 50% in 2020, as companies increasingly favor lower-risk mature basins and infrastructure-led opportunities, reflecting growing ESG pressures and stricter capital discipline.
The 2025 lease round activity is projected to be somewhat subdued relative to 2024.Presently, approximately 14 licensing rounds remain active worldwide for companies to compete on exploration acreage. With fewer rounds expected, competition for high-potential blocks in proven basins could intensify among operators seeking new opportunities.
Global oil and gas discoveries have been steadily declining since their peak in 2010, when nearly 51 billion barrels were found—mirroring the broader reduction in exploration spending. Although there was a brief rebound in exploration investment in 2022 following the sharp, pandemic-driven decline in 2021 (when volumes discovered dropped by 43%), the downward trend persisted. Discovered volumes fell again, decreasing by 38% over the course of 2023 and 2024. In 2024, global exploration and production (E&P) investments held steady compared to the previous year, with Rystad Energy projecting consistent annual spending around $50 billion before a projected decline to about $40 billion by 2030. This years exploration spending reached approximately $52 billion across onshore and offshore projects, a sharp drop from the 2013 peak of $118 billion, the highest in 15 years. This ongoing decline highlights several structural changes: a strategic shift of capital toward energy transition initiatives, a greater emphasis on optimizing existing assets over new exploration, and persistent difficulties in achieving value-adding returns from traditional exploration. These trends reflect explorations evolution from a primary growth driver to a cautiously managed element of diversified energy portfolios.
Rystad Energys preliminary analysis shows that exploration activities resulted in a net loss of $8.6 billion in 2024. Although improved operational efficiency helped E&P companies generate positive value after 2017, sustaining those gains has been difficult. The industry reached its peak value creation in 2021 at nearly $60 billion, but this has declined steadily since. A major factor behind the drop is the continued decrease in global discovered volumes, which has significantly undermined overall net value creation.
Exploration spending is expected to remain relatively stable in 2025, hovering around USD 50 billion. However, this figure may be reduced if the pricing environment weakens further. Approximately 25% of upstream investment in 2025 is anticipated to be directed toward new field developments—broadly consistent with 2024 levels. That said, approvals for new projects may be delayed as operators seek more certainty regarding the economic landscape and oil market conditions
Major oil companies are evolving their exploration strategies to balance growth and green goals – cutting back on far-flung wildcats, embracing digital tech, and pivoting to gas and "advantaged" oil. Their moves, along with those of increasingly influential NOCs, indicate an industry adapting to investor expectations and climate imperatives. Geopolitical and price conditions in 2025 provide both opportunities and risks: energy security needs are giving exploration a new rationale, yet volatility and policy changes demand agility. The industry appears to be threading this needle by leveraging technology and smarter practices to ensure each exploration dollar yields maximum value.
Investment in Energy
Shifting Energy Capital Flows
Global energy investment trends through 2030 reveal a decisive shift toward clean energy solutions, with renewables like solar, wind, and grid infrastructure now commanding over 70% of power sector spending—triple the investment flowing into fossil fuels. The IEAs World Energy Investment report projects global energy sector investment to reach USD 3.3 trillion in 2025—a 2% increase in real terms over
2024. Of this, approximately USD 2.2 trillion is expected to flow into clean energy technologies, more than double the USD 1.1 trillion allocated to fossil fuels such as oil, natural gas, and coal.12 Global upstream oil and gas investment is projected to decline by approximately 4% in 2025, falling to just under $570 billion._This drop is primarily driven by a_6% year-on-year decrease in upstream oil spending, which is expected to total around_$420 billion, marking the first year-on-year drop since the COVID-19 downturn in 2020 and the largest decrease since 2016.12 Initial projections based on company announcements suggested that upstream oil and gas spending would remain steady, but weakening oil prices have led to a more cautious outlook. While investment in natural gas fields is expected to hold steady at 2024 levels, reduced spending on oil projects brings total upstream oil and gas investment for 2025 to just under USD 570 billion—a decline of approximately 4%. In addition, global refinery investment in 2025 is forecast to fall to its lowest level in a decade. Nearly 40% of upstream capital now simply offsets production declines from aging fields rather than expanding capacity. This "running to stand still" dynamic persists even as companies pour $700B+ annually into maintaining flows amid peak-ish demand near 103M bpd. The math exposes the transitions core tension - renewables scaling cant yet outpace natural field depletion rates (~4-6%/year), forcing continued fossil investment even in decarbonization scenarios. Major oil companies walk a tightrope - distributing record profits while cautiously investing in synergistic transition technologies like offshore wind and CCS. The next two years will prove critical, with success hinging on battery storage breakthroughs, biofuel scaling, and actual implementation of climate pledges. This period may reveal whether the world is truly reaching peak fossil fuels or facing transition delays.
The rise of the ‘Age of Electricity is reshaping investment patterns, fueled by soaring electricity demand from industry, cooling, electric mobility, data centers, and artificial intelligence. In 2025, global investment in the electricity sector is projected to reach USD 1.5 trillion—approximately 50% more than the combined spending on oil, natural gas, and coal supply.
Over the past five years, spending on low-emissions power generation has nearly doubled, with solar PV playing a major role in that growth. Investment in solar energy—across both utility-scale and rooftop installations—is projected to reach USD 450 billion in 2025, making it the largest individual category within global energy investment.11 Investment in nuclear energy has also increased by 50%, marking a comeback. At the same time, approvals for new gas-fired power plants are picking up, reflecting the ongoing effort to balance clean energy development with system reliability.
Although several LNG projects currently under construction or in planning have experienced delays and cost overruns, the recent surge in investment is expected to significantly expand global supply by 2030. Over the past decade, more than USD 250 billion has been invested in LNG liquefaction infrastructure, with an additional USD 115 billion allocated to regasification facilities. Approximately 270 bcm per year of new liquefaction capacity is scheduled to come online by 2030, representing a nearly 50% increase in global supply.11 While some project timelines have been extended in the past two years, the period between 2026 and 2028 is projected to deliver some of the largest annual increases in LNG capacity on record.
In conclusion while total energy investments are at an all-time high, and capital is decisively tilting toward clean energy technologies – yet oil and gas are not disappearing anytime soon. Oil and gas companies, influenced by market volatility and investor pressures, are applying stringent criteria to capital allocation. They are concentrating on projects with robust, quick returns and shying away from ultra-long-term or speculative developments. This is evidenced by industrys overall cost-cutting and the narrowing of focus onto the most productive basins and assets. The upstream sector today is leaner and more efficient: companies are pruning their portfolios, shedding marginal projects and doubling down on the most promising opportunities that can deliver value even in a transition-conscious world.
Mergers & Acquisition
Dealmaking at the Crossroads: A Post-Boom Outlook
The IEA notes that early 2025s plummeting oil prices and rising market uncertainty are pushing global oil companies to rethink their upstream strategies. As OPEC+ starts phasing out its 2 million barrel per day production cuts, in place since 2023, non-OPEC+ producers face increased pressure to adapt. Amid this turbulence, global upstream oil investment is expected to drop 6% in 2025 to around $420 billion, driven by price volatility and a wider industry reassessment. Upstream M&A activity is expected to slow in the near term, with around $151 billion in global opportunities currently available. Analysts at Rystad Energy suggest that deal values are unlikely to match the highs of the past two years, as the wave of consolidation in the US shale sector has largely played out.
Upstream M&A activity reached approximately $205 billion in 2024, maintaining the strong momentum seen in 2023. This marked only the second time in the last ten years that the total deal value surpassed $200 billion.13 Despite experiencing a 21% decline in value from the previous year, North America remained the dominant region, contributing $134 billion—around 65% of the global total. This was largely driven by a surge in consolidation within the US shale sector, which saw about 17 key transactions throughout the year.11 These followed a smaller wave of three acquisitions that emerged in late 2023 and sparked broader activity. Among the most notable deals in 2024 were Diamondback Energys acquisition of Endeavour Energy in the Midland Basin for approximately $26 billion, ConocoPhillips takeover of Marathon Oil for $22.5 billion, and Chesapeake Energys purchase of Southwestern Energy for nearly $11.7 billion.
External factors are likely to slow deal activity. Increased geopolitical tensions in the Middle East and fiscal difficulties in the UK are expected to suppress transaction volumes. However, potential counterbalancing activity may occur in the US, where a resurgence of shale gas deals could be driven by reinstated LNG export permits under President Donald Trumps administration, provided Henry Hub prices remain supportive
3. Indian Economy
Diverse Forces Driving Indias Economy
Over the past 30 years, India has steadily emerged as a major global economy, powered by its vast 600-million workforce, rapidly expanding middle class, and strategic location. The countrys economic momentum reached new heights in 2022 when it became the worlds fifth-largest economy, and recent IMF data shows it has now overtaken Japan to claim fourth place. India stands out as the only major economy to have doubled its GDP in the last decade, while simultaneously lifting 250 million people out of poverty - creating a dynamic new consumer class thats driving domestic growth.
This remarkable progress has made India an increasingly attractive destination for foreign investment, with its digital transformation, manufacturing capabilities, and infrastructure development fuelling further expansion. As India continues its ascent toward becoming the worlds third-largest economy, with a nominal GDP estimated at over $4 trillion, Indias rise marks a historic shift in the global economic order and highlights its growing role as a key driver of worldwide growth and investment.
India has displayed steady economic growth. Indias real GDP growth of 6.5 % in FY25 remains close to the decadal average. The Reserve Bank of India expects the same rate to continue in 2025–26. Amid global economic uncertainty, Indias steady growth stands out—demonstrating resilience when other major economies face challenges. Its ability to maintain momentum positions the country as both a stabilizing force and an increasingly attractive destination for investment. Indias economic resilience shines through key metrics: record forex reserves, a stable current account deficit, and rising foreign investment – all signalling strong global confidence in its sustainable growth story.
A key driver behind this performance has been the Indian governments continued focus on public investment and infrastructure-led growth. In line with this vision, the Union Budget for FY 2025–26 proposed a 10% increase in capital expenditure, raising the Centres outlay to a historic 11.21 trillion. This decisive commitment to capital formation not only enhances productivity and job creation but also generates positive multiplier effects across the broader economy. Retail inflation in India has followed a steady downward path over the past three financial years, falling from 6.7 percent in 2022–23 to 5.4 percent in 2023–24, and further to 4.6 percent in 2024–25.14 Inflation cooled sharply to a six-year low of 2.82% (CPI) in May 2025, stays comfortably within RBIs target band, reflecting effective policy measures and supply-side improvements. RBIs latest projections put CPI inflation for FY 2025-26 at around 3.7%– comfortably within the target band.
The financial sector is undergoing a structural shift, marked by a sharp rise in consumer credit, which now accounts for over 30% of total bank credit—up from around 20% a decade ago. Non-banking finance is expanding rapidly, offering new avenues for both borrowers and investors. Equity-based funding is also on the rise, with IPOs increasing sixfold between FY13 and FY24—from just 16 in FY13 to nearly 100 in FY24. Retail participation has also risen sharply. The number of retail investors jumped from 4.9 crore in 2019 to 13.2 crore by the end of 2024. While these trends reflect growing financial deepening, they also raise red flags. The surge in unsecured consumer lending and the entry of a younger, often less experienced investor base highlight the need for balanced regulation—one that fuels growth without compromising systemic stability.
The countrys investor-friendly FDI policy, permitting 100% foreign ownership in most sectors via the automatic route, has fueled a 14% surge in FDI inflows to $81.04 billion in FY 2024–25, up from $71.28 billion in FY 2023–24. This is over twice the $36.05 billion recorded in FY 2013–14, reflecting strong long-term growth. Indias total exports soared to a record $824.9 billion in FY 2024–25, a 6.01% increase from $778.1 billion in FY 2023–24, showcasing robust growth in global trade.
In April–December FY 2024–25, the RBIs Monetary Policy Committee held the repo rate steady at 6.5%, while shifting its stance from "withdrawal of accommodation" to "neutral" in October. To ease liquidity pressures, the CRR was reduced to 4% in December, and the RBI injected160,000 million into the banking system during the quarter. The Cash Reserve Ratio (CRR) will be lowered from 4% to 3% in four tranches of 25 basis points each, starting September 2025. This phased reduction is expected to inject an additional 250,000 million into the banking system in the coming months.
According to Provisional Estimates of Indias Gross Domestic Product (GDP) for the financial year 2024–25, Indias real GDP is projected to grow by 6.5% in FY 2024-25. For FY2025–26, various agencies forecast Indias GDP growth in the range of 6.2% to 6.5%, underpinned by strong domestic fundamentals, prudent macroeconomic management, and sustained government-led capital expenditure.
Nevertheless, external risks remain. Chief among them is the potential imposition of U.S. tariff on Indian imports, currently under temporary suspension as bilateral negotiations progress. A favourable trade agreement could help neutralize this risk and provide a lift to Indias export sector. Geopolitical tensions, particularly in the Middle East, also pose a risk by potentially driving up oil prices and straining macroeconomic stability. At the same time, private investment sentiment remains cautious, shaped by ongoing global volatility and uncertainty in external demand.
4. India Energy Snapshot
Balancing Growth and Sustainability
Powering industries, energizing infrastructure, and electrifying aspirations for 1.4 billion people, energy sits at the heart of Indias growth story. As the nation charges toward its $5 trillion economy ambition, its energy sector is undergoing a radical metamorphosis - scaling sustainable solutions and democratizing access to fuel an inclusive development revolution. This isnt just about meeting demand; its about rewriting the rules of energy security for the 21st century, while staying true to its global climate commitments.
As the worlds third-largest oil consumer, India faces a critical energy security challenge, relying on imports for over 87% of its crude needs. The post-2020 period has exposed this vulnerability through successive shocks—from pandemic-driven demand collapses to geopolitical upheavals like the Russia-Ukraine war and Middle East conflicts, compounded by shifting U.S. sanctions regimes. While discounted Russian crude provided temporary relief, the potential reinstatement of stringent U.S. sanctions under a Trump administration in 2025 threatens this fragile equilibrium. The IEA projects that Indias oil demand will rise by a substantial 1 million barrels per day (mb/d) in between 2025 and 2030,15 marking the highest absolute growth of any country. This five-year period (2020-2025) underscores a hard truth: global oil market volatility directly impacts Indias trade balance, fiscal health, and forex reserves. In 2024, Indias crude oil import bill reached $137 billion, a substantial burden for a developing nation, underscoring the urgency of addressing energy security challenges.16 Coal also plays a vital role in Indias fuel security by providing reliable base-load power that supports grid stability. With around 360 billion tons of domestic reserves, coal helps reduce dependence on unpredictable global markets, offering protection against disruptions such as those caused by the COVID-19 pandemic and the Russia-Ukraine conflict. The solution lies in a three-pronged approach—diversifying supply sources, accelerating renewable energy adoption, and building strategic reserves—to insulate the economy from future shocks while transitioning toward sustainable energy independence.The Government of India has made impressive strides in expanding access to electricity and clean cooking solutions, while also enacting various energy market reforms and successfully integrating a substantial share of renewable energy into the national grid. Indias primary energy demand is expected to rise by 90% under the Current Trajectory and 21% in the Net Zero scenario between 2022 and 2050 (CAGRs of 2.3% and 0.7%, respectively). Consequently, its share of global primary energy consumption is expected to grow from 7% in 2022 to around 12% by 2050 in both scenarios.
India is moving into a dynamic new phase in its energy development marked by a long-term net zero emissions ambition. India has announced a net zero emissions target by 2070 and has put in place policies to scale up clean energy supply and clean technology manufacturing. India is expected to meet its 2030 target to have half of its electricity capacity to be non-fossil before the end of the decade. As India shifts towards renewable energy sources, it must navigate complex international landscapes to secure the necessary materials and technologies.
India has rapidly advanced in the renewable energy industry, emerging as a leading player on the global stage. According to IRENA, India now ranks 4th globally in overall renewable energy capacity, with a remarkable 49% of its cumulative installed capacity coming from non-fossil fuel sources. Since 2014, the countrys renewable power generation has more than doubled, growing from 190 BU to 403 BU.
In FY 2024–25, Indias renewable energy sector reached a significant milestone, with total installed capacity soaring to 220 GW, driven by a record 30 GW addition, up from 190 GW the previous year. Solar power led the way at 106 GW, while wind power crossed the 50 GW threshold, showcasing robust growth.14 This achievement aligns with Indias ‘Panchamrit goals, targeting 500 GW of non-fossil fuel-based capacity by 2030. Key policies such as ISTS waiver, long-term RPO trajectory until 2029–30, and the introduction of Green Open Access Rules have played a pivotal role in accelerating the countrys clean energy transition.
Indias energy choices in this decade will decisively influence its emissions trajectory through 2050. The government has emphasized that energy security and access cannot be compromised even as it pursues decarbonization. To strengthen domestic production and reduce reliance on imports, OALP Round-X, launched at India Energy Week 2025, offers 25 blocks across 13 sedimentary basins, spanning a record 1.92 lakh square kilometers, with 51% in previously restricted zones. This marks Indias largest-ever oil and gas exploration bid round.
Govts ambition is to enhance energy security while supporting a sustainable transition, ensuring economic stability and alignment with global climate goals. This has led to a dual-track approach: continue certain fossil fuel investments for the near term (e.g. expanding domestic coal mining and oil extraction) while aggressively scaling up renewables and efficiency. The challenge is managing this trade-off so that short-term energy needs do not lock India into a high-carbon path incompatible with its climate goals
Crude Oil & Natural Gas production
Domestic crude oil production in FY25 stood at 28.6 Million Metric Tonnes (MMT)17 versus 29.3 MMT during FY24. ONGCs crude production in FY25 was 20.89 MMT versus 21.14 MMT in FY24. ONGC accounted for more than 73% of domestic crude oil production.
Natural Gas output in FY25 was 36.11 Billion Cubic Metres (BCM)17, versus 36.43 in FY24. In FY25, ONGCs domestic output stood at 20.19 BCM vs 20.65 in FY24. ~56% of gas output has been produced by ONGC.17
Consumption of Petroleum Products
Domestic petroleum products consumption in FY25 increased by around 2.1% to approximately 239.2 MMT18. Petrol consumption rose by 7.5% to 40 Million Tonnes in 2024–25, while diesel sales grew by 2.0% to 91.4 Million Tonnes. LPG consumption increased by 5.6% to 31.3 Million Tonnes, supported by government initiatives for clean cooking. Meanwhile, ATF demand surged 8.9% to 9 Million Tonnes, driven by robust growth in aviation traffic and near full recovery of the air travel sector.
Import and Export
Indias crude oil trade dynamics witnessed notable shifts in FY25, with crude imports rising by 3.7% to 243 MMT, compared to 234.3 MMT in FY24, as reported by the Petroleum Planning and Analysis Cell (PPAC). Despite the increase in import volume, the import bill dropped to USD 118.4 billion, down from USD 133 billion the previous year, due to a decline in international crude prices. Import dependence edged higher, reaching 89.1% in March 2025, reflecting a combination of stagnant domestic output and growing fuel demand. On the export front, petroleum product shipments grew modestly to 65.1 MMT in FY25, up from 62.6 MMT a year earlier, supported by steady refinery utilization and global demand for transport fuels.
Crude oil Price: Indian Basket
The price of Brent Crude averaged USD 83.15 per barrel in FY2023–24, which declined to USD 78.91 per barrel in FY2024–25, and further to USD 67.79 per barrel in April 2025. Similarly, the Indian basket crude oil price averaged USD 82.58 per barrel in FY2023–24, dropped to USD 78.56 per barrel in FY2024–25, and stood at USD 67.73 per barrel in April 2025.
Domestic Gas Prices
Natural gas continues to play a pivotal role in Indias clean energy ambitions, with the government reaffirming its goal of increasing its share in the countrys primary energy mix from around 6.7% in FY2024–25 to 15% by 2030. This shift is being driven by a combination of policy reforms, pricing rationalization, and infrastructure expansion. In FY2024–25, the governments revised domestic gas pricing guidelines—linking gas prices to 10% of the Indian crude basket—helped improve transparency and market alignment. For gas from nomination fields of ONGC and OIL, a floor of $4/MMBtu and a ceiling of $ 6.50/mmbtu (enhanced to $6.75/MMBtu for FY 2025-26) were maintained, with a 20% premium for gas from new wells, incentivizing additional production. At the same time, gas from HPHT and deepwater fields remained eligible for pricing freedom within a higher ceiling of $10.04/MMBtu (applicable for April to Sep 2025), encouraging exploration in technically challenging zones.
On the supply side, domestic production increased modestly due to new projects in the Krishna-Godavari Basin, while import dependence continued as LNG filled nearly half of the total gas demand. The government continued awarding explorationblocksthroughtheOpenAcreageLicensingPolicy (OALP), with ONGC, OIL, and private players securing new fields under HELP and DSF bidding rounds. Simultaneously, the National Gas Grid expanded to 24,600 km, with over 10,800 km of pipelines under construction, improving interconnectivity and reducing regional disparities. Indias gas-based power plants are operating at suboptimal capacity due to low gas availability. To address this, the government has permitted LNG imports under Open General License (OGL). Additional measures include schemes for procuring power from gas plants during peak demand. Broader gas sector reforms include expanding the National Gas Grid and City Gas Distribution networks, establishing LNG terminals, prioritizing domestic gas allocation for CNG/ PNG, introducing pricing flexibility for difficult fields, and promoting Bio-CNG through the SATAT initiative - all aimed at increasing natural gas share in Indias energy mix to 15% by 2030.
These advancements have not only improved energy access but also supported environmental goals by substituting coal and oil with cleaner-burning natural gas. Industrial users, power generators, and transport sectors benefitted from more stable pricing and improved availability, driving a resurgence in gas demand across the economy. While challenges remain—such as ensuring price competitiveness, securing long-term LNG supplies, and accelerating infrastructure execution—the coordinated push through pricing, regulatory, and physical infrastructure reforms has laid a robust foundation. With momentum sustained through FY2024–25, India is steadily progressing toward its 2030 vision of a gas-based economy, balancing energy security, economic development, and environmental sustainability.
Domestic Upstream Reforms and Initiatives
In 2024, the Government of India passed a major amendment to the Oilfields (Regulation and Development) Act, 1948, effective from April 2025. The Amendment Bill seeks to do away with the historical erroneous practice of putting mining and petroleum operations in the same bucket. This reform introduced a single unified license for all forms of hydrocarbons (oil, gas, shale, CBM), replacing multiple licenses and simplifying exploration and production (E&P) processes. It extended lease tenures, enabled international arbitration for contract disputes, and established a dedicated adjudication mechanism. The amendment shifted the focus of regulation from royalty collection to production facilitation, with enhanced penalties for non-compliance and provisions for resource-sharing among operators. In parallel, the Ministry of Petroleum and Natural Gas (MoPNG) has reduced the number of mandatory approvals for E&P projects from 37 to 18, with nearly half available via self-certification, improving ease of doing business. The government also opened 99% of offshore "No-Go" areas for exploration. Licensing reforms continued under the Open Acreage Licensing Policy (OALP), with Rounds IX and X launched in 2024–25, offering record acreage across frontier and deepwater basins. Additionally, natural gas pricing was revised in favor of domestic producers (linked to 10% of Indian crude basket prices), and windfall profit taxes on crude oil were abolished, signaling a broader push to attract investment and boost domestic output.
Operational Performance:
ONGC plays a critical role in determining the growth and sustainability of Indias oil and gas sector. In recent years, ONGC Group has demonstrated resilience and adaptability in the face of evolving industry dynamics, with steady production across domestic and international assets. For FY25, Oil & Gas production of ONGC Group, including PSC-JVs and from overseas Assets has been 51.4 MMTOE (against 52.3 MMTOE during FY24). Oil and gas production profiles from domestic as well as overseas assets during last five years are as given below:
| Oil and gas production | FY25 | FY24 | FY23 | FY22 | FY21 |
| Crude Oil Production (MMT) | 28.16 | 28.32 | 27.83 | 29.80 | 31.04 |
| ONGC | 19.60 | 19.47 | 19.58 | 19.54 | 20.27 |
| ONGCs share in JV | 1.29 | 1.67 | 1.901 | 2.16 | 2.26 |
| ONGC Videsh | 7.27 | 7.18 | 6.35 | 8.10 | 8.51 |
| Natural Gas Production (BCM) | 23.20 | 23.98 | 25.17 | 25.91 | 27.35 |
| ONGC | 19.65 | 19.97 | 20.63 | 20.91 | 22.10 |
| ONGCs share in JV | 0.54 | 0.67 | 0.72 | 0.77 | 0.72 |
| ONGC Videsh | 3.01 | 3.34 | 3.82 | 4.23 | 4.53 |
Proved reserves
Position of proved reserves of your Company (including ONGC Videsh) is as below:
| Proved Reserves (MMtoe) | FY25 | FY24 | FY23 | FY22 | FY21 |
| ONGC | 515.17 | 514.83 | 530.71 | 557.31 | 580.52 |
| JV share | 10.75 | 11.26 | 12.10 | 14.22 | 16.33 |
| ONGC Videsh | 249.50 | 253.81 | 264.09 | 274.34 | 273.59 |
| Estimated Net Proved | 775.42 | 779.90 | 806.90 | 845.87 | 870.44 |
| O+OEG Reserves |
Financial performance: ONGC (Standalone)
(Rs.Million)
| Particulars | FY25 | FY24 | % Increase / (Decrease) |
| Revenue: | |||
| Crude Oil | 895,353 | 918,665 | (2.54) |
| Natural Gas | 338,178 | 334,287 | 1.16 |
| Value Added Products | 140,079 | 124,790 | 12.25 |
| Other Operating revenue | 4,853 | 6,279 | (22.71) |
| Total Revenue from Operations: | 1,378,463 | 1,384,021 | (0.40) |
| Other Income | 104,794 | 107,355 | (2.39) |
| EBIDTA | 757,162 | 775,932 | (2.42) |
| Exceptional items-Income/ (expenses) | - | - | - |
| PBT | 467,598 | 530,162 | (11.80) |
| PAT | 356,103 | 405,260 | (12.13) |
| EPS () | 28.31 | 32.21 | (12.11) |
| Dividend per share () | 12.25 | 12.25 | - |
| Net Worth ** | 3,162,835 | 3,059,765 | 3.37 |
| % Return on net worth | 11.26 | 13.24 | (14.99) |
| Capital Employed | 1,805,224 | 1,753,922 | 2.92 |
| % Return on capital employed | 26.54 | 30.60 | (13.27) |
| Capital Expenditure | 620,573 | 374,942 | 65.51 |
** includes reserve for equity instruments fair valued through other comprehensive Income.
| Particulars | 2024-25 | 2023-24 | Change in % |
| (i) Debtors Turnover (days) | 29 | 31 | (6.45) |
| (ii) Inventory Turnover | 12.40 | 14.54 | (14.72) |
| (iii) Interest Coverage Ratio | 222.33 | 185.16 | 20.07 |
| (iv) Current Ratio | 1.40 | 1.58 | (11.39) |
| (v) Debt Equity Ratio | 0.03 | 0.02 | 50.00 |
| (vi) Operating Profit Margin (%) | 37.26 | 41.25 | (9.67) |
| (vii) Net Profit Margin (%) | 25.83 | 29.28 | (11.78) |
| (viii) Return of Net Worth (%) | 11.26 | 13.24 | (14.95) |
Notes:
1. Change in Debt Equity Ratio
The Debt Equity ratio for FY 2024-25 is 0.03 against 0.02 in FY 2023-24 i.e. reduction by 50.0%, this is cumulative impact of increase in Total Borrowings by Rs. 22,985 million and increase in Total equity by Rs. 103,070 million. The increase in Total Borrowings is mainly due to increase in Working Capital Loan by Rs. 22,269 Million during FY25.
Financial performance: ONGC (Group)
(Rs. Million)
| Particulars | FY25 | FY24^ | % Increase/ (Decrease) |
| Revenue from Operations | 6,632,623 | 6,531,708 | 1.55 |
| Other Income | 123,936 | 120,307 | 3.02 |
| EBIDTA | 1,012,543 | 1,144,137 | (11.50) |
| PBT | 523,979 | 736,292 | (28.84) |
| Profit after Tax for the year | 383,286 | 552,731 | (30.66) |
| Particulars | FY25 | FY24^ | % Increase/ (Decrease) |
| - Profit attributable to Owners of the Company | 362,256 | 491,439 | (26.29) |
| - Profit attributable to Non-Controlling interests | 21,030 | 61,292 | (65.69) |
| EPS () | 28.80 | 39.06 | (26.27) |
| Net Worth * | 3,434,405 | 3,390,689 | 1.29 |
| % Return on net worth | 10.55 | 14.49 | (27.19) |
| Capital Employed | 2,947,753 | 2,703,809 | 9.02 |
| % Return on Capital employed # | 21.84 | 30.38 | (28.11) |
^ Restated
* includes reserve for equity instruments through other comprehensive income.
# Return on capital employed is calculated without considering the impact of exceptional items. In case exceptional item is also considered for calculating PBIT, ROCE would be 21.79% for FY25 and 29.78% for FY24.
5. Strength & Weakness
A Legacy of Energy Leadership
Since its inception, ONGC has delivered a monumental 2,111.53 MMToE of cumulative production - a testament to its pivotal role in powering Indias energy needs. In FY25 alone, the company dominated Indias domestic production with 72.8% of crude oil output and 55.8% of natural gas, commanding a 63.3% share of the nations total hydrocarbon production. ONGC maintains a strong exploration and production foundation, supported by its extensive resource base of skilled personnel and their technical expertise. This capability enables ONGC to implement proactive measures in both new and mature fields—including new well drilling, well stimulations, and enhanced water injection—to offset natural production decline.
Notably, ONGC has nearly arrested the year-on-year decline in oil production at the standalone level, with FY25 marking the first annual growth in nearly a decade as standalone crude output rose by 0.9%. This turnaround was powered by record drilling (35-year high well count) and successful monetization of 8 discoveries. However, many of ONGCs offshore fields (particularly in the Western Offshore like Mumbai High) are older and naturally declining at higher rates, contributing to pressure on overall consolidated output. ONGCs proactive field management (such as infill drilling and water-flood projects) continues to mitigate decline onshore, even as it confronts steeper declines offshore.
As deepwater and ultradeep frontiers redefine global energy, ONGC is engineered for the challenge. In a major thrust towards unlocking frontier basins, ONGC has commenced ultra-deepwater drilling operations in the Andaman Sea, a region emerging as one of Indias most promising untapped hydrocarbon provinces. Deploying the DDKG-1 rig and targeting depths up to 5,000 metres, this exploration campaign reflects ONGCs commitment to expanding its offshore footprint through advanced seismic imaging and high-spec drilling technology.
Further strengthening its domestic E&P portfolio, ONGC recorded a significant pool discovery named Chola in the Cauvery Offshore basin in August 2024, reaffirming the potential of Indias east coast. Additionally, the Chandramani (B-56-2) prospect discovery in the Western Offshore basin in July 2024 adds to the companys growing inventory of exploratory successes. In the downstream segment, ONGC continues to benefit from the strategic performance of its key subsidiaries. Hindustan Petroleum Corporation Limited (HPCL) achieved record refinery throughput of 25.27 MMT in FY25 and expanded its retail network to over 23,700 outlets, reinforcing its supply resilience and market presence. Mangalore Refinery and Petrochemicals Ltd. (MRPL) also hit a record throughput of 18.04 MMT, operating at 120% capacity, while OPaL, now a subsidiary, completed its capital restructuring and transition from SEZ to Domestic Tariff Area for better market access and operational flexibility. Together, these downstream entities not only enhance ONGCs vertical integration but also provide a financial hedge against upstream volatility, contributing to sustained group-level stability. As the global energy market continues to evolve, the Chemicals and Petrochemicals sector emerges as a pivotal force, poised to drive substantial demand within the oil industry over the next decade and beyond.
As the international exploration and production arm of ONGC, ONGC Videsh Limited (OVL) plays a pivotal role in expanding the companys global footprint, securing critical energy resources, and fostering strategic partnerships across 15 countries. With participation in 32 oil and gas projects—including 14 producing and 11 exploration assets—OVL contributed over 10 MMTOE to ONGCs consolidated production in FY25, reaffirming its position as Indias second-largest E&P entity after ONGC itself.
ONGC encounters a range of challenges in its growth trajectory, beginning with the inherently limited hydrocarbon prospectivity of Indias sedimentary basins, which constrains large-scale expansion opportunities. This is further compounded by the complexities of managing mature fields, which include dealing with aging infrastructure, rising operational costs amid natural production declines, and the intricate geological characteristics of reservoirs that demand advanced technical solutions and continuous optimization. Indias oilfield services sector struggles to keep pace with industry needs, importing major advanced upstream technologies. The limited access to cutting-edge solutions depresses recovery rates while inflating costs, particularly in complex projects. Bridging this gap requires either rapid domestic capability building or deeper technology transfer partnerships with global OFS leaders.
6. Opportunities & Threats
Seizing opportunities and Mitigating Threats
With energy consumption rising faster than any other major economy, the imperative to tap domestic resources has never been stronger. Indias sedimentary basins, covering 3.4 million square kilometers, remain vastly underexplored. While geoscientific surveys have been completed across 61% of this area, less than 10% has been penetrated by drilling. According to the most recent resource reassessment study, Indias basins hold an estimated 42 billion tonnes of oil equivalent (BTOE) in total hydrocarbon resources. To date, only 12 BTOE have been discovered, leaving a massive 30 BTOE of potential yet to be realized.
While monetizing reserves has become increasingly challenging, this is largely due to new discoveries being in geologically and logistically complex regions, coupled with limited availability of high-quality data—making developments vulnerable to operational uncertainties. Production costs remain elevated, primarily driven by a mature asset portfolio and legacy contractual structures. The Western Offshore basin has long served as the backbone of our operations. For ONGC to continue its growth trajectory, this region must retain its pivotal role. The completion of 50 successful years of Mumbai High stands as a remarkable milestone in our journey. Even today, the Mumbai High and Bassein & Satellite (B&S) assets collectively account for nearly 60% of ONGCs total production—a testament to their enduring strategic importance. The experience and insights gained from managing these brownfield assets provide a strong foundation as we look to navigate the complexities of future deep-water developments Amid the progressive natural decline of fields in the Western Offshore region, ONGC is strategically prioritizing production enhancement initiatives to sustain output levels. A key development in this direction is the adoption of a Technology, Services, and Partnerships (TSP) approach—most notably the recently formalized collaboration with BP to enhance production from the Mumbai High (MH) field. This partnership aims to leverage BPs global expertise and advanced recovery technologies to revitalize ONGCs
flagship asset, which continues to contribute a significant share of national oil output. In FY26, ONGC is poised to focus on enhancing production from mature assets, fast-tracking recent discoveries, and deepening its TSP (Technology, Services, and Partnerships) strategy. Your Company will also prioritize commissioning the Eastern Offshore Asset and developing finds in the Mahanadi, Cauvery, and Cambay basins. Efficiency will be driven by brownfield optimization, EOR scale-up, digital tools like IDAS and SANJAI, and tighter cost control—especially in drilling. Your Company also made efforts for global outreach for deep & ultra-deepwater exploration by engaging with global majors like ExxonMobil, RIL-BP, Total Energies, PEPOV (Petronas), Petrobras, ENI, etc to explore opportunities for Farm-in and joint bidding of OALP blocks in risk and cost intensive frontier areas.
In parallel, a particularly promising growth vector is expected to emerge in the CNG and natural gas segment. The governments anticipated implementation of a 20% premium for gas from new wells—together with the planned monetization of Daman Upside Development Project (DUDP) in the third quarter of FY26—is poised to unlock significant momentum in domestic gas development.
From 2024 to 2030, global oil demand is forecast to increase by 2.5 million barrels per day (mb/d). Notably, the petrochemical industry is poised to become the dominant source of oil demand growth from 2026 onwards. ONGC maintains a significant presence in the petrochemicals sector through OPaL ,MRPL, HMEL and HRRL, integral to its diversification strategy. The company is advancing plans to expand its oil-to-chemicals operations, aiming to convert crude oil directly into high-value chemical products. In view of the above, OPaL, in particular, has undergone a recent financial restructuring that has transformed it into a near wholly-owned subsidiary of ONGC—an effort aimed at ensuring its long-term operational and financial sustainability. The conversion of debt into equity, infusion of additional equity coupled with a committed supply of gas feedstock from ONGCs fields, is expected to significantly improve its cost structure. As a result, OPaL is now positioned on a path toward profitability, enhancing its appeal for potential strategic partnerships in the future. Indias petrochemical demand is projected to grow by approximately 9% in 2025. However, despite this positive demand outlook, domestic producers, including ONGC, face margin pressures due to global oversupply. Increased capacities in Asia, particularly China, amid weak demand, have led to surplus products entering markets like India, suppressing prices. While India is expanding its petrochemical production, it remains import-dependent for several key products. This imbalance is expected to persist in the near to medium term, continuing to challenge the profitability of domestic petrochemical producers.
While stricter environmental regulations pose long-term challenges for fossil fuels, Indias current heavy dependence on oil and gas imports (87% of crude demand) provides a transitional buffer._ ONGC is using this window to reinvent business models for future viability. ONGC currently emits annually and has set a
approximately 9 million tonnes of CO2
target to achieve net-zero Scope-1 and Scope-2 emissions by 2038. To achieve this, the company plans to invest 2 trillion towards offsetting 14.58 million tonnes of
CO2-equivalent
emissions by 2038, making it the first energy company and Public Sector Undertaking in India to outline a detailed GHG reduction plan. ONGC Green Limited (OGL), a wholly-owned subsidiary of ONGC incorporated on February 27, 2024, has rapidly expanded its renewable energy portfolio to support ONGCs decarbonization goals. Since commencing operations in April 2024, OGL has acquired 288.8 MW of wind capacity from PTC Energy Ltd and, through a 50:50 joint venture with NTPC Green Energy Ltd, taken over Ayana Renewable Power, adding a combined 2.345 GW of renewable assets. These acquisitions have increased ONGCs total RE capacity, marking significant progress toward its 2030 target of 10 GW and net-zero (Scope 1 & 2) emissions by 2038.
In a strategic step towards green energy leadership, ONGC signed a MoU with Power Grid on Dec 12, 2024, BHEL on Jan 10, 2025, and Tata Power Renewables on Feb 9, 2025 to jointly explore business opportunities across the Green Hydrogen value chain. This includes development in Electrolyser Technology, storage systems, fuel cells, captive power, hydrogen-fired turbines, and advanced applications aimed at decarbonizing Indias energy infrastructure. In line with global efforts, your company has become a signatory to the Oil and Gas Decarbonization Charter (OGDC) at COP-28, committing to achieve Net-Zero operations by 2050, eliminate avoidable flaring, and significantly reduce upstream methane emissions by 2030. ONGC has made measurable progress toward emission reduction. It conducted advanced methane monitoring using TROPOMI satellite data and drone-based AUSEA technology in partnership with TotalEnergies, detecting 25.35 MMSCM of fugitive methane emissions in FY25, with repair campaigns underway. Also a dedicated CCUS lab has been established at KDMIPE, and six CDM projects have been submitted for transition under the Paris Agreements Article 6.4 mechanism.
The todays energy sector technology is key to overcoming challenges—cutting costs, reviving aging fields, and exploring new frontiers. As global firms invest heavily in AI and digital tools, were future-proofing our workforce by integrating tech talent across all operations.
7. Risks, Concerns and their Management
ONGC, as one of Indias premier energy enterprises, operates in a complex and volatile global environment that presents a broad spectrum of risks. To navigate this challenging landscape, ONGC has institutionalized a comprehensive risk management framework aligned with ISO 31000 standards. This framework is designed to proactively identify, assess, and mitigate various forms of risk—strategic, financial, operational, and support-related—thus ensuring the organizations resilience, continuity, and long-term sustainability.
A key strategic risk arises from the inherent volatility in crude oil and natural gas prices, which are influenced by factors such as global demand-supply dynamics, geopolitical developments, actions by OPEC+ nations, and government-imposed price ceilings. Significant fluctuations in pricing can materially affect ONGCs profitability, capital investments, and cash flow stability. To address this, ONGC engages closely with regulatory stakeholders to secure fair pricing mechanisms, reduces operating expenditure through automation and efficiency enhancements, and maintains a strong balance sheet to cushion against market uncertainties.
Climate change and the ongoing global energy transition present another critical strategic concern. With growing international and domestic emphasis on decarbonization, the industry faces the prospect of increased regulation, heightened compliance costs, and long-term shifts in demand patterns. ONGC is responding decisively by embedding Environmental, Social, and Governance (ESG) principles into its corporate strategy. The company has committed to achieving Net Zero emissions (Scope 1 and 2) by 2038, reducing upstream methane emissions and eliminating routine flaring by 2030. Investments in carbon capture, renewables, and energy efficiency initiatives further reinforce ONGCs commitment to environmental stewardship.
As part of its Vision 2040 strategy, ONGC is also diversifying into low-carbon energy businesses, including solar, wind, biofuels, hydrogen, and LNG. While strategically aligned with national priorities, these ventures carry financial and operational uncertainties, particularly in terms of return on investment and integration with traditional business lines. ONGC manages these risks by subjecting all green investments to rigorous financial modeling, due diligence, and ESG-aligned performance monitoring to ensure capital efficiency and long-term value creation.
Financial risks for ONGC are significant, especially in the form of currency exchange rate volatility. Given that oil and gas transactions are largely denominated in US dollars, fluctuations in exchange rates can impact both revenue and expenditure. ONGCs response includes a robust Foreign Exchange and Interest Rate Risk Management Policy, natural hedging practices, and oversight by a dedicated Forex Risk Management Committee that meets quarterly to review exposures, market conditions, and hedging strategies. Additionally, regulatory interventions such as the capping of natural gas prices pose challenges to revenue generation and investment capacity. ONGC is actively pursuing revenue diversification, operational efficiency, and strategic partnerships to enhance its financial flexibility and resilience.
Operational risks are intrinsic to ONGCs activities, particularly due to its geographically dispersed and technically complex operations across onshore and offshore environments. The company is exposed to a range of health, safety, and environmental (HSE) risks, including natural disasters, equipment failures, and potential accidents. To mitigate these, ONGC has implemented rigorous compliance measures, invested in advanced monitoring systems, and adopted proactive emergency response protocols. Adequate insurance coverage and stakeholder communication further support operational continuity.
A significant operational concern is the companys dependence on mature oil and gas fields, which are susceptible to natural production decline. ONGC is addressing this through enhanced oil recovery techniques, improved reservoir management, and technological collaborations with service providers. At the same time, the risk of failing to discover or develop new reserves persists due to geological uncertainties and high capital intensity. To counter this, ONGC is investing in frontier exploration, advanced seismic imaging, and reservoir modeling to improve discovery rates and optimize resource extraction. Exploration activities themselves pose high financial and technical risks, especially in deep-water and ultra-deep-water drilling, where conditions are challenging and costs are substantial. ONGC mitigates these risks by integrating geological, geophysical, and petrophysical data to develop probabilistic models that guide exploration decisions. The use of 3D seismic surveys and other advanced subsurface technologies helps reduce uncertainty and improve the success rate of hydrocarbon discovery.
Another key operational risk is reserve replacement. As production continues, the inability to replenish reserves through new discoveries or enhanced recovery can impair future output and financial performance. ONGCs response includes scaling up exploration investments, adopting innovative recovery techniques, and targeting underexplored basins with high geological promise. Strategic diversification into renewable energy is also a part of its broader risk mitigation strategy to remain relevant in a transitioning energy landscape.
Support risks include legal uncertainties and cyber threats. ONGC faces exposure from pending litigations and contractual disputes, which can result in liabilities and financial unpredictability. The company addresses this through thorough contract review, legal due diligence, and the implementation of modern contract management systems. Where possible, ONGC explores alternative dispute resolution mechanisms such as arbitration and mediation to resolve conflicts efficiently.
Cybersecurity is a growing area of concern as the company becomes increasingly reliant on digital infrastructure. Threats such as cyberattacks and data breaches can disrupt operations and compromise sensitive information. ONGCs mitigation strategy includes a comprehensive Information Security Management System (ISMS), real-time threat monitoring, and continuous employee training programs to ensure awareness and preparedness against digital risks. In conclusion, ONGC acknowledges that while a wide array of structured mitigation strategies are in place, residual risks will continue to evolve. The company remains committed to refining its risk management systems to adapt to emerging challenges, ensuring operational excellence, financial robustness, and strategic agility in the years ahead.
8. Outlook
The outlook for Indias oil and gas sector remains cautiously optimistic, driven by strong domestic demand but tempered by global volatility and energy transition pressures. Amid this backdrop, ONGC is navigating the complexities with a focused strategy grounded in accelerated exploration, operational optimization, and energy diversification. ONGC has built a robust portfolio of both greenfield developments and brownfield redevelopment projects. As of_Mar2025, twenty_one_(21) projects_costing Rs. 1000 milion. & above are under implementation in ONGC._ During the FY25, 6 major projects with an investment value of around
89,742 Million were completed. This balanced project pipeline is crucial for sustaining production momentum, especially in the face of fluctuating oil prices. In recent years, your Company has significantly accelerated the transition of discoveries into production, making notable contributions to the nations exploration and production (E&P) efforts. On 30th October 2024, EOA opened the first well A2-A of A-field of deepwater block KG-DWN-98/2. After ramping up of the same, other two wells, i.e. A2-C and A2-B were also opened as per plan. On 16th Dec2024, Eastern Offshore Asset (EOA), Kakinada, successfully monetized all oil fields of the KG-DWN-98/2 Cluster-II project by putting 5 oil wells of P-field into production.
The company has also initiated an ultra-deepwater exploration program in the Andaman Basin, planning to drill three wells as part of this effort.
Post award of OALP-IX block, ONGC currently holds 2,48,621 km? of exploratory acreage across India and continues to actively pursue opportunities to establish a commercial footprint in new and frontier regions. To support its ambitious deepwater exploration strategy, your Company is engaging with leading international oil firms to explore potential collaborations and integrate advanced technologies. Your Company is also poised for stronger global growth. During FY25, ONGC Videsh Limited (OVL) produced 7.27 MMT of oil and 3.01 BCM of natural gas, bringing the total overseas production to 10.28 MMTOE. This robust performance was supported by enhanced output from key assets in Colombia (CPO-5 and MECL blocks) and South Sudan (GPOC and SPOC), where operated and jointly operated assets registered strong growth driven by successful infill drilling, well optimization, and resilience amid geopolitical and logistical challenges. Additionally, exploration successes in South Sudan and Colombia have secured critical license extensions and opened new development opportunities, including the discovery of a new play (LS-3) in the CPO-5 block.
In alignment with its strategy to integrate operations across the energy value chain, ONGC is planning to enter the energy trading sector beginning in FY26. This strategic move is intended to enhance value capture within its hydrocarbon portfolio and leverage changing market conditions by establishing a specialized and responsive trading division. Energy Strategy 2040: In 2019, ONGC adopted its Energy Strategy 2040 as a long-term strategic roadmap, with Energy Transition identified as a core pillar. As the global energy landscape continues to evolve rapidly, this transition has become even more central to shaping the Companys future direction. In 2025, ONGC is actively revamping its strategic framework with the support of leading global consultants to align with emerging challenges and opportunities in the low-carbon economy. Backed by robust and consistent cash flows, ONGC is well-positioned to consolidate its leadership in the traditional energy sector while accelerating its shift toward a more diversified, resilient, and sustainable portfolio. The Company is also focused on building agility to capitalize on future business opportunities across oil, gas, and clean energy domains. While 2025 is anticipated to be a solid year of performance, ONGCs long-term success will depend on its ability to proactively adapt to market shifts, strengthen low-carbon investments, and remain a cornerstone in Indias energy security and sustainability goals Here is a brief overview of the exploration status, initiatives in emerging areas, and efforts to enhance production:
8A. Exploration
In FY 2024–25, ONGC continued to drive its long-term "Future Exploration Strategy" with a sharper focus on expanding domestic resource potential, rejuvenating mature basins, and tapping into new frontier areas including ultra-deepwater zones. Through sustained seismic surveys, strategic drilling programs, and strengthened partnerships with global energy majors, ONGC reinforced its position as Indias leading exploration entity.
The Company notified nine new hydrocarbon discoveries during the year — five onshore and four offshore — including significant finds in the Bengal, Cambay, Mumbai Offshore, Krishna-Godavari (KG) Onland, and Cauvery basins. Noteworthy among these were Ranaghat-2 in Bengal Onland, West Matar-2 in Cambay, Neelmani and Suryamani in Mumbai Offshore, and Chola-1 in Cauvery Offshore ultra-post-NELP exploration of the basin.
Exploration activity intensified under the Open Acreage Licensing Policy (OALP) framework. 15 OALP Blocks covering total area of 82,560.26 Sq.km. were awarded to ONGC under OALP bid round-IX. These included a mix of onland, shallow water, and ultra-deepwater blocks across various basins. For the first time, ONGC successfully bid for a block in consortium with an International Oil Company (IOC) under OALP-IX. As of 1 April 2025, ONGC had acquired a cumulative 4,754.92 LKM of 2D seismic data and 32,204.11 SKM of 3D seismic data in OALP blocks and drilled a total of 53 exploratory wells across these acreages. Specifically, in FY25, ONGC acquired 604 LKM of 2D and 8,840 SKM of 3D seismic data, with 377 LKM 2D and 6,141 SKM 3D from OALP blocks. During the year, a total of 107 exploration wells (including 33 wells in Petroleum Exploration Licenses) and 2 CBM assessment wells were drilled. Of the 70 wells tested, 27 were hydrocarbon-bearing; an additional 38 wells from previous years were also tested, with 20 proving successful. This led to an overall success ratio in exploratory drilling of 43.5%, or 1 in every 2.3 wells. In the year ONGC also launched a landmark ultra-deepwater exploration campaign in the Andaman Basin, targeting three ultra-deepwater wells—reinforcing its commitment to unlocking frontier hydrocarbon resources Ongoing efforts in basement play exploration resulted in drilling 12 dedicated wells across Cambay, A&AA, and Western Offshore basins, with multiple wells yielding positive hydrocarbon indications, supporting future unconventional development strategies.
Additionally, ONGC continued to strengthen its global outreach in the domain of deepwater and ultra-deepwater exploration through strategic engagements with leading international energy companies, including ExxonMobil, TotalEnergies, RIL-BP, Petronas, Petrobras, and ENI. These discussions are centered around joint bidding, farm-in opportunities, and collaboration in high-risk, frontier regions. In a significant step forward, ONGC Videsh signed an MoU with Petrobras on February 12, 2025, to explore joint opportunities in upstream exploration, marketing, decarbonization, and low-carbon solutions—reinforcing ONGCs strategic presence and partnerships.
Through this multi-pronged exploration approach — grounded in domestic basin knowledge, data-led operations, and collaborative international frameworks — ONGC is consolidating its reserve base and unlocking Indias next wave of hydrocarbon resources.
8B. Development of new fields
In FY 2024–25, ONGC reinforced its commitment to enhancing domestic oil and gas production through accelerated field development, focused monetization of discoveries, and strategic expansion into unconventional and offshore assets. This approach is aligned with the national objective of reducing energy import dependence while ensuring timely delivery from critical upstream assets.
Although First Oil from the M field of the KG-DWN-98/2 block commenced in January 2024, the fiscal year 2024–25 marked the first full year of stabilized deepwater operations from this asset. The M field, along with the previously monetized U field, represents one of ONGCs most significant deepwater production clusters, with output supported by subsea infrastructure and FPSO systems. During the year, ONGC monetized two new hydrocarbon discoveries—West Matar-2 and Yandapalli-1—with an estimated reserve of 13.15 MMTOE, in addition to six discoveries from previous years. These monetizations underscore ONGCs ability to transition rapidly from exploration success to commercial production.
As of March 31, 2025, ONGC was executing twenty-one major projects with a cumulative approved cost of 653,891million. These projects are expected to collectively yield approximately 83.72 MMTOE of oil and gas over their operational life, contributing significantly to the Companys production base. In addition to conventional assets, ONGC also made advances in unconventional energy production. Commercial sale of gas from the CBM Bokaro block began on July 16, 2024, via the GAIL-operated Urja Ganga pipeline. Furthermore, gas sale from the North Karanpura block commenced on May 16, 2025, through a cascade delivery model. These milestones indicate successful monetization of coal bed methane blocks, further diversifying the Companys production portfolio.
ONGC also took a major step toward boosting shallow water gas production on the west coast by awarding contracts under the Daman Upside Development Project. This project targets marginal gas fields such as B-12 and C-24 and is a crucial component of ONGCs offshore gas development strategy.
To support these field development and production enhancement efforts, ONGC continued to maintain strong capital investment discipline. The total capital expenditure for FY 2024–25 amounted to 620,573 million, with 390,838 million investments were toward exploration, drilling, field development, asset integrity improvements, and digital transformation initiatives.
All these efforts are structured around the Companys long-term production vision under its five-year strategic plan, ‘Sankalp 50, launched in March 2024. This plan sets the ambitious target of reaching 50 MMTOE of annual production by FY 2028–29 and includes specific Key Performance Indicators (KPIs) for assets and basins to ensure systematic monitoring and performance accountability.
Through timely execution of high-impact projects, monetization of discoveries, and forward-looking investment strategies, ONGC is steadily building a stronger and more diversified upstream portfolio, firmly positioning itself to meet Indias future energy requirements.
9. Internal Control Systems
ONGC has institutionalized a comprehensive internal control framework designed to ensure transparency, accountability, and operational excellence across all verticals, with a particular focus on field operations. These systems are continuously reviewed and refined to align with industry best practices and the evolving needs of the business environment. Standardized operating procedures and guidelines have been meticulously established and disseminated across all work centers, ensuring consistent and effective implementation from strategic to ground-level operations.
At the heart of ONGCs performance architecture lies the Performance Management and Benchmarking Group (PMBG), which plays a critical role in evaluating the operational performance of business units. This group actively monitors results against defined Key Performance Indicators (KPIs), formalized through Performance Contracts signed between senior leadership and business executives. This structured framework promotes data-driven decision-making and fosters a culture of accountability and measurable outcomes at every level.
In pursuit of its broader systemic transformation agenda, ONGC has placed strong emphasis on deploying digital tools, streamlining processes, and adopting agile systems to enhance operational efficiency and productivity. A key initiative in this domain is the implementation of the E-Grievance Handling System, which ensures prompt redressal of stakeholder concerns and strengthens internal governance through transparent, time-bound resolution mechanisms.
The Company also maintains a dedicated Internal Audit (IA) group that conducts independent, risk-based audits across functional domains. To complement internal capabilities, ONGC engages specialized external agencies for complex or high-risk reviews. Statutory audits are conducted by firms appointed by the Comptroller and Auditor General (CAG) of India, adhering strictly to applicable legal frameworks and timelines.
Beyond financial controls, ONGC places high priority on safety and regulatory compliance through routine third-party safety audits of its offshore and onshore operations. These are carried out by nationally and internationally accredited agencies, including the Oil Industry Safety Directorate (OISD) and the Directorate General of Mines Safety (DGMS). Each operational site is supported by dedicated Health, Safety, and Environment (HSE) teams responsible for enforcing safety norms, securing regulatory clearances, and ensuring adherence to environmental standards.
To further strengthen process integration and automation, ONGC has successfully implemented the SAP S/4HANA-based ERP platform, which serves as the digital backbone of its business transactions. This infrastructure provides real-time data visibility, enhances financial controls, and ensures comprehensive audit trails. A structured authorization framework embedded within ERP safeguards company assets and ensures that all transactions are well-documented, approved, and compliant with internal and external financial reporting standards.
Furthermore, ONGC has embedded Outcome Budgeting as a strategic planning tool to sharpen the focus on return on investment and improve resource allocation efficiency. Capital and operational expenditures—particularly those directed toward development drilling and capital infrastructure—are now systematically linked to projected incremental gains in oil and gas production over a five-year planning horizon. This budgeting model also incorporates profitability variation analysis, projected balance sheets, cash flow forecasts, and sensitivity assessments to account for volatility in crude oil prices and exchange rates.
In parallel, ONGC has strengthened its cost efficiency efforts by establishing a Cost Control Council focused on process streamlining, identifying key cost reduction areas, and optimizing capital deployment across operations.
Through the institutionalization of these robust internal systems, digital governance platforms, and forward-looking planning mechanisms, ONGC continues to reinforce the integrity, resilience, and strategic agility of its operations—solidifying its long-term commitment to sustainable value creation and organizational excellence.
10. Human Resource Development
At ONGC, people are at the heart of its progress and value creation journey. As of March 31, 2025, ONGC employed a committed workforce of 24,368 regular personnel. ONGC remains focused on building a future-ready, high-performance work environment that is rooted in continuous learning, capability enhancement, and strong institutional culture.
With a generational shift on the horizon, ONGCs talent strategy emphasizes workforce planning, leadership succession, and knowledge transfer. Central to this approach is the goal of developing the next generation of "energy leaders" who are equipped to navigate the complex and evolving dynamics of the energy sector.
In FY 2024–25, ONGC delivered extensive capacity-building interventions, training 13,461 executives and 4,304 non-executives across technical, functional, and managerial domains. Advanced Training Institute (ATI) also delivered globally certified programs, including OPITO, NEBOSH, and
IOSH, and effectively facilitated the National Seminar of FSAI "FESA (Fire Electrical Security and Automation)-2025 for Pharma and allied industries".
To deepen leadership capability, the Company has launched "Unnati Shikhar", an Accelerated Leadership Development Programme targeting high-potential executives at the mid-management levels. This initiative blends experiential learning, role immersion, and ongoing capability development to build a robust leadership pipeline.
Recognizing the dynamic nature of the energy industry, ONGC also partners with premier institutions in India and abroad to equip its professionals with cutting-edge skills. Programs such as the Leadership Development Program, Advanced Management Program, and Senior Management Program ensure ONGC leaders stay ahead of the curve. Beyond learning and development, ONGC promotes a vibrant workplace culture. Through dynamic employee engagement initiatives and curated learning experiences, ONGC fosters innovation, collaboration, and performance excellence. In addition to professional growth and well-being, ONGC has a robust employee support framework. This includes welfare trusts for provident fund, medical benefits, pension, and gratuity. Initiatives like the Sahyog Yojana and Asha Kiran Scheme provide financial support during emergencies, reaffirming ONGCs culture of care and compassion.
Through its integrated approach to people development—spanning leadership, learning, engagement, wellness, and recognition—ONGC continues to set industry benchmarks in Human Resource Development and remains firmly committed to unlocking the full potential of its workforce.
11. Environmental Protection and Conservation, Technology Conservation, Renewable Energy developments, Foreign Exchange Conservation
Amidst the looming threat of climate change and its severe impacts on lives and livelihoods, nations must urgently decouple economic growth from environmental degradation. India has taken bold steps in this direction, most notably through Prime Minister Modis "Panchamrit" pledge at COP26, signaling a firm national commitment to sustainable growth and climate action. In alignment with this vision, ONGC continues to mitigate the environmental impact of its core operations—exploration, drilling, and production—by deploying state-of-the-art technologies, enhancing effluent and solid waste management systems, conducting rigorous environmental monitoring, and undertaking biodiversity conservation initiatives.
A dedicated Carbon Management and Sustainability Group (CM&SG) oversees the companys emissions reduction roadmap and ensures alignment with applicable regulations. ONGCs adherence to defined policies such as the Integrated QHSE Policy and E-Waste Policy further reinforces environmental responsibility across its operations. The
Company regularly measures, monitors, and reports Scope 1 and Scope 2 emissions, with a firm commitment to achieve net-zero emissions for these scopes by 2038. In FY 2024–25, ONGC reported Scope 1 and 2 emissions of 9.501 million metric tonnes
CO2e and an emission intensity of 0.242
MMTC02e/MMTOEG.
All major installations are ISO 50001 certified, and operations follow global standards from the World Business Council for Sustainable Development (WBCSD), World Resources Institute (WRI), and GHG Protocols, along with APIs sector-specific emissions estimation methodologies. ONGC has intensified its methane emissions control program under the Global Methane Initiative (GMI). During FY25, approximately 25.35 MMSCM of fugitive methane emissions were detected, with remediation underway. Since 2008, ONGC has identified and addressed 45.83 MMSCM of methane emissions through Leak Detection and Repair (LDAR).
As part of global climate leadership, ONGC has signed the Oil and Gas Decarbonization Charter (OGDC) at COP-28, pledging to eliminate routine flaring by 2030 and achieve near-zero upstream methane emissions. A strategic collaboration with TotalEnergies is also underway to implement AUSEA drone-based methane detection technology across installations. In the renewable energy domain, ONGC has significantly scaled up its green portfolio. In FY25 alone, it added 2.345 GW of renewable energy capacity through the acquisition of PTC Energy Ltd (288.8 MW wind) and Ayana Renewable Power Pvt. Ltd. Additionally, ONGC operates 193.86 MW of in-house solar and wind power and has deployed over 362,622 LED lights under the UJALA scheme to boost energy efficiency.
In alignment with the Government of Indias vision to achieve 100 GW of nuclear power capacity by 2047, ONGC is also exploring the potential of deploying Small Modular Reactors (SMRs) to harness clean and reliable nuclear energy. Complementing its emissions mitigation efforts, ONGC is also investing in Carbon Capture, Utilization and Storage (CCUS) research. Its dedicated laboratory at KDMIPE, Dehradun has undertaken breakthrough geochemical studies in Gandhar Field and Mumbai Offshore to assess sequestration potential, with a patent filed for a new geochemical site selection methodology.
Through these focused and data-driven initiatives, ONGC is not only aligning with Indias sustainability goals but also positioning itself as a global leader in responsible energy transition.
Initiatives of your Company towards Technology Conservation, Renewable Energy developments, Foreign Exchange Conservation are detailed in Boards Report.
12. Corporate Social Responsibility (CSR)
Initiatives taken by your Company towards CSR are detailed in CSR Report.
13. Cautionary Statement
Statements in the Management Discussion and Analysis and Directors Report describing the Companys strengths, strategies, projections and estimates, are forward-looking statements and progressive within the meaning of applicable laws and regulations. Actual results may vary from those expressed or implied, depending upon economic conditions, Government Policies and other incidental factors. Readers are cautioned not to place undue reliance on the forward looking statements.
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