Russia’s share in India’s oil imports touch a high of 42% in May

Russia’s share in India’s oil imports touch a high of 42% in May

While the share of the 13 member countries of OPEC in India’s crude oil imports has been consistently declining over the last six years, it fell sharply in FY23 and FY24 till date. This is because the country suddenly scaled up oil imports from Russia following the geopolitical conflict.  

Taking advantage of the ban imposed by the US and European Union on imports from Russia after it invaded Ukraine in February 2022, India ramped up its oil imports from Russia as it started selling its oil at a discount to select countries.

According to the Petroleum Planning and Analysis Cell (PPAC), the share of OPEC in India’s crude oil import fell almost 15 percentage points from 86.5% in in April-May FY18 to 71.8% in April-May FY22, and further to 66.7% and 44.9% respectively in the corresponding periods in FY23 and FY24.

In May 2023, with 1.96 million barrels per day (mbd) from Russia, the share of Russian oil imports reached a record high of 42%, which was higher than the combined oil imports from Saudi Arabia, Iraq, the UAE and the US. Saudi Arabia saw a major decline.

India, the world’s third largest crude oil importer and consumer, has been strategically diversifying its crude supply sources. It has a daily oil consumption of around 5 million barrels with a refining capacity of 250 MMTPA. Indian energy companies buy from all major oil producers in the world. From Russia, it buys in US dollars for oil below the $60 per barrel cap imposed by the West, and uses UAE dirhams for oil above the cap.

India stepped up its import of cheap Russian oil despite sanctions from the West saying it had to provide “energy justice” to its citizens. “India has the unique distinction of servicing 60 million visitors at its petrol pumps every single day. Despite challenging times, it is important for the government to ensure access to affordable energy to our citizens,” the government said last year.