Russia Surpassed OPEC Partners In India’s Import, With Iraq On The Top

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According to Bloomberg, Russia has surpassed OPEC partner Saudi Arabia in expanding its market share as one of the largest crude importers to India. This happens despite growing fuel demand in India and high crude oil prices on the international market. In May 2022, Iraq continued to be India’s top supplier, while Saudi Arabia is now its third-largest provider.

According to Reuters, India’s import bill for oil grew to $47.5 billion in the second quarter due to an increment in world prices and recovering gasoline demand. Indian refiners got the most Russian oil ever in May, at around 819,000 barrels per day (BPD).

Russia pushes Saudi Arabia to third place to become India’s second-biggest oil exporter in May | Hindustan Times

Russian barrels were less expensive than Saudi Arabian barrels from April through June 2022. They supplied oil to India at a wide discount of $19 per barrel in May. With Russia becoming a major supplier of fuels, India may see a structural change in the country’s crude oil supply. This would lessen New Delhi’s reliance on West Asian oil, offer Indian refiners more negotiating leverage with Saudi Arabia, and increase the country’s overall energy security.

According to the statistics, Russian grades made up approximately 16.5 percent of India’s total oil imports in May. They helped increase the proportion of C.I.S. oil imports to around 20.5 percent, while Middle Eastern oil imports decreased to about 59.5 percent. According to the report, the percentage of African oil in India’s crude imports increased from 5.9 percent in April to 11.5 percent last month.

The raw crude that is compatible with their refinery and product configurations would be sought after by Indian refiners. Right now, Russian crude meets the criteria because they are increasing their supply to Europe, and the Saudis and Iraqis are not fully losing out.

India purchases 85 percent of its oil requirements from Russia in an effort to provide some economic comfort in the midst of high inflation and a record trade deficit. Due to high freight expenses, Indian refiners seldom purchased Russian oil; thus, this gave them a chance to get cheap crude.

India escalated its oil imports from Russia during a period of rising energy costs by taking advantage of cheap pricing. Crude oil is what keeps the globe turning in the modern world. The natural resource known as “crude” is first taken from the soil and then processed into commodities like heating oils, jet fuel, and petroleum. Since every item we use every day needs to travel great distances, the price of crude affects the cost of necessities like food and clothes.

ABHIJEET ANAND

Sociologist, Engineer, and Content writer

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