India’s oil import bill saw a decline in September, October, and November, despite an increase in the volume of oil imports, as global crude prices softened in recent months, according to data from the Ministry of Petroleum. This trend contrasts with the first five months of the current financial year (FY25), when oil import values rose compared to the same period last year.
The drop in global oil prices has provided a relief for India, which is heavily reliant on imported oil. Government data reveals that India’s dependence on imported crude oil stood at 88.1% from April to November this year. Oil and gas imports make up the largest share of India’s total merchandise import bill.
India’s reliance on foreign oil makes its economy vulnerable to fluctuations in global oil prices. These price changes affect not only the country’s trade deficit but also its foreign exchange reserves, the rupee’s value, and inflation. The government has been striving to reduce this dependency, but sluggish domestic oil production amidst rising demand for petroleum products remains a significant challenge.
In the September-November period, the value of India’s oil imports fell by 9% year-on-year, totaling $31.2 billion. However, import volumes increased by 4.4%, reaching 57.2 million tonnes. In November, the value of oil imports was 13% lower than the same month last year, while volumes rose by 2.7%. October saw a similar trend with a 10.9% drop in value but a 4.3% rise in volumes. In September, the import value declined by 2.8%, while volumes grew by 6.3%.
In contrast, between April and August of FY25, India’s oil imports in value terms increased by 14.2% year-on-year, amounting to $60.3 billion. Volumes grew by just 2.6%, reaching 101 million tonnes.
For the first eight months of FY25, oil import volumes rose 3.5% year-on-year to 159.4 million tonnes, while the value of imports increased by 5%, reaching $91.8 billion, compared to $87.4 billion in the same period last year. If the trend of rising volumes and falling value continues, India’s total oil import bill for FY25 could be lower than last year, despite increased import volumes.
Global oil prices have been under pressure recently, largely due to a slowdown in demand from China, a stronger US dollar—which makes dollar-denominated commodities more expensive—and concerns about global economic growth. Brent crude prices fell from about $91 per barrel in early April to around $71 per barrel by the end of November. Meanwhile, the price of India’s crude oil basket dropped from $89.44 per barrel in April to $73 per barrel in November. India’s oil basket is a blend of sour and sweet crude oils processed in Indian refineries in a 78.5:21.5 ratio.
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