India’s net oil and gas imports in value terms for April-January of fiscal year 2023-24 (FY24) declined by nearly a fifth on a year-on-year (YoY) basis to $101.3 billion due to relatively lower prices of crude oil, natural gas, and petroleum products in the international market, as per latest data from India’s Ministry of Petroleum & Natural Gas.
This decline in the value of oil and gas imports came despite a rise in import volumes, suggesting that the fall in prices was significant enough to offset the volume growth. In the first 10 months of the previous financial year, 2022-23 (FY23), India’s net oil and gas import bill was $124.8 billion.
Oil, natural gas, and refined petroleum products had seen extreme price volatility in the last financial year following Russia’s February 2022 invasion of Ukraine. In the initial few months of FY23, international prices of these commodities were overheated. Their prices in the current financial year have been relatively softer and far less volatile.
The average price of the Indian basket of crude for April-January of FY24 was $82.4 per barrel, but in the first 10 months of FY23, it was $96. Oil and gas imports have the highest share in India’s overall merchandise import bill. Petroleum product exports are among India’s top merchandise exports in value terms.
According to provisional data from the Petroleum Planning & Analysis Cell (PPAC) of the petroleum ministry, India imported crude oil worth $110.5 billion in April-January of the ongoing fiscal, against $136.2 billion a year ago. However, in volume terms, oil imports for the period were higher by 0.9 per cent at 194.2 million tonnes.
Apart from generally lower prices of crude oil globally, India has also benefited from ramping up imports of discounted Russian crude. Although the discounts are not as high as last year, the volume of oil imported from Russia has gone up notably.
In April-December of FY23, Moscow had a share of nearly 18 per cent in New Delhi’s overall oil imports (by volume), as per India’s official trade data. In the first nine months of the current fiscal, Russia accounted for a whopping 37 per cent of India’s oil imports. The government has so far not released country-wise trade data for January.
As for natural gas, which is imported into India in the liquefied form, import value for the first 10 months of FY24 was $10.9 billion, down over 26 per cent from a year ago. On the other hand, liquefied natural gas (LNG) import volumes for the period were higher by 15.4 per cent at 25,305 million standard cubic metres (mscm).
The country’s petroleum product imports in April-January declined almost 15 per cent year-on-year to $19.2 billion, while petroleum product exports were down nearly 20 per cent to $39.2 billion.
India is a net exporter of petroleum products, thanks to its refining capacity of over 250 million tonnes per annum exceeding the country’s domestic demand. India, however, does not export crude oil and natural gas and is heavily dependent on imports of both due to high domestic demand and low production.
According to the PPAC data, India’s import dependency in the case of crude oil was 87.6 per cent in April-January, up from 87 per cent a year ago due to a rise in consumption even as domestic production remained stagnant. The country is the world’s third-largest consumer of crude oil. India’s domestic crude oil production in April-January was almost flat year-on-year at 24.5 million tonnes. Consumption of petroleum products, however, rose to 192.7 million tonnes from 183.1 million tonnes a year ago.
Source: The Indian Express
