Key Highlights of India’s Oil Import Scenario
- April 21, 2024
- Posted by: OptimizeIAS Team
- Category: DPN Topics
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Key Highlights of India’s Oil Import Scenario
Subject: Economy
Sec: External Sector
- Reduction in Import Bill:
- India’s crude oil import bill witnessed a significant decline of 16% in the fiscal year ended March 31, attributed to lower international prices.
- Despite importing a similar volume of crude oil as the previous fiscal year, India paid $132.4 billion for imports in FY24, compared to $157.5 billion in FY23.
- Continued Dependence on Overseas Suppliers:
- Despite the reduction in import bill, India’s dependency on overseas suppliers reached a new high.
- Import dependence for crude oil surged to 87.7% in FY24, up from 87.4% in the previous fiscal year, highlighting the nation’s heavy reliance on imports to meet its energy needs.
- Stagnant Domestic Production:
- India’s domestic crude oil production remained nearly unchanged at 29.4 million tonnes in FY24.
- This stagnation in domestic production contributes to the country’s increasing reliance on imported oil.
- Import of Petroleum Products and LNG:
- Apart from crude oil, India imported petroleum products like LPG, spending $23.4 billion on 48.1 million tonnes of imports.
- Additionally, the country imported 30.91 billion cubic meters of LNG, costing $13.3 billion, in FY24.
- The import of LNG experienced a decrease compared to the previous fiscal year due to the price shock caused by geopolitical events.
- Net Import Bill and Trade Balance:
- Petroleum imports accounted for 25.1% of India’s gross imports, while petroleum exports represented 12% of the country’s gross exports in FY24.
- Rising Fuel Consumption:
- India’s fuel consumption witnessed a notable increase of 4.6% to a record 233.3 million tonnes in FY23.
- This upward trend in fuel consumption reflects the country’s growing energy demand and economic activity.
- Surplus Refining Capacity:
- Despite challenges in crude oil production, India maintains surplus refining capacity, enabling the export of petroleum products like diesel.
- This surplus capacity enhances India’s position in the global refining industry, contributing to its energy security strategy.