Oil & Natural Gas Corporation (ONGC) is gearing up for a tougher crude oil market. The company aims to reduce its production and operating costs by 15 % over the next two years, targeting savings of approximately ₹ 9,000 crore by FY27. Of this, ₹ 4,300 crore is expected to be saved by March 2026 through early actions.
ONGC expects global crude prices to hover between $60–65 per barrel in the medium term. To adapt, it has drawn up more than 20 cost‑cutting initiatives. These include offshore resource optimization, improving drilling efficiency, streamlining logistics routes, reducing inventory, and better fuel usage control.
Part of the plan involves scaling operations at the Pipavav Supply Base in Gujarat to reduce transport and handling costs. ONGC is also venturing into oil trading business, aiming for annual profits around $1 billion in the coming years.
ONGC recently partnered with BP to boost output from the Mumbai High offshore field, aiming to unlock $15 billion in additional revenue over 10 years. In field KG‑DWN‑98/2 in the Krishna‑Godavari basin, ONGC expects up to 12 million tonnes of oil and 13.5 BCM of gas with improved development strategies.
If successful, the cost cut and efficiency overhaul would help ONGC protect margins even under a subdued oil price scenario.
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