New Delhi, India (CU)_ The third leading oil consumer in the world imports more than 85% of its crude oil requirements. Due to the Ukraine crisis that drove world oil prices to record highs, the crude oil import cost of India has nearly doubled in the 2021-2022 financial year, which ended on March 31. According to figures published by India’s Petroleum Planning & Analysis Cell (PPAC), the nation spent $119.2 billion in that fiscal year.
According to reports, the country’s oil import cost was little more than $62 billion in the 2020-2021 fiscal year. India, the third leading oil consumer in the world, imports over 85% of its crude oil requirements. According to the PPAC report, imports for the most recent financial year surpassed 212 million tonnes, which is an increase from 196.5 million tonnes in the preceding 12 months but remaining slightly below pre-pandemic levels.
Global oil prices have been optimistic since January, frequently trading above the key $100 per barrel level, with March recording a high of $140 per barrel. Increased crude oil imports are projected to have a negative impact on the macroeconomic metrics of the Indian administration led by Prime Minister Narendra Modi, who had set an ambitious goal of lowering the country’s crude oil imports by 10%.
India’s domestic oil output continues to dwindle, resulting in increased imports. India produced 29.7 million tonnes of crude oil in the financial year 2021-2022, significantly less than the 30.5 million tonnes produced in the previous year. According to PPAC statistics, India’s liquefied natural gas import bill also climbed to $11.9 billion in the fiscal year 2021-2022, much more than the $7.9 billion in LNG imports in the past 12 months.
Global LNG prices have soared in recent months, leading to higher import costs for Indian industries. While numerous Indian gas importers, notably Petronet LNG, have long-term contracts associated with crude oil prices, corporations are increasingly using a combination of short-term and spot contracts in addition to their longer-term commitments.
