Reliance, India’s largest forex earner, imports heavy crude oil and exports mostly aviation fuel after refining the imported crude in its giant refineries in Jamnagar. With nature being niggardly in bestowing India with oil reserves, the country imports nearly 80% of the crude. While the public sector refineries cater to the domestic demand, Reliance ships a sizeable part of its petroleum products abroad without having to worry about hedging its foreign exchange risks—it pays for its imports with the export earnings, which is technically known in the forex lingo as a natural hedge. Its state-of-the-art refineries are paying it rich dividends. Reliance promoters understood the oil business only too well—access to crude is not enough; it takes refineries to make the crude usable and saleable.

The US paradox is equally interesting but a lot more involved and complicated. It has ample crude oil production from its shale extraction fields but is exported to refineries abroad, mainly in Asia and the Middle East, where refineries are equipped to refine light or sweet crude. The refineries in the US, built decades ago, are equipped only to refine imported heavy, high-sulphur crude from places like Canada, Mexico, the Middle East, and, lately, Venezuela in its backyard. The access to bountiful Venezuelan crude, gained recently in copious quantities, will keep the US refineries going, earning enormous export earnings.

Shale gas technology is also known as horizontal drilling or fracking,........

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