India draws back from tighter oil trade regulation

India will not change its rules for hedging risks by oil firms in the over-the-counter market, a spokeswoman for the Reserve Bank of India said, calming fears that such derivatives may be banned for refiners.
Oil firms have been worried since November, when the Reserve Bank of India issued draft guidelines for over-the-counter foreign exchange derivatives and hedging commodity risk and freight risks.

The central bank said on Nov. 12 it wanted comments on the proposed guidelines, which it said were prepared in light of developments in the domestic and international financial markets and based on the feedback from banks, market participants and industry associations.
The guidelines included parameters for hedging of crude oil imports using exchange-traded futures and options on international exchanges.

A director at a leading state-run oil refiner said before the spokeswoman's comment that his company was seeking clarifications from the central bank about the hedging rule.
A top official at another refining firm said the central bank's guidelines did not mention any proposed ban on over-the-counter oil swaps.