India's Q1 oil import bill up 61%: What's the reason?
What's the story
India's crude oil import bill surged by a whopping 61% to $49.8 billion in the April-June period, compared to the same period last year. The spike comes despite a 4% decline in import volumes during this time, according to data from the Petroleum Planning and Analysis Cell (PPAC). The rise is mainly attributed to global crude prices remaining above $100 per barrel due to geopolitical tensions and shipping disruptions.
Market fluctuations
US-Iran conflict, Strait of Hormuz blockade disrupt supplies
The US-Iran conflict and the blockade of the Strait of Hormuz have disrupted West Asian supplies, leading to a spike in global crude prices.
In June, India's crude oil imports fell by 7% to 18.9 million tons from 20.3 million tons last year.
However, the import bill for this month alone surged by 48% to $14.7 billion due to these price hikes.
Energy shift
India turns to Russia for energy needs
Despite importing less oil overall in June, India's costs still climbed, up 48% from last year for that month alone.
At the same time, India turned more to Russia for its energy needs: Russian crude imports jumped 34%, making India the world's second biggest buyer of Russian hydrocarbons that month.
Import details
Crude imports during the June quarter
India's crude oil imports during the June quarter stood at 59.8 million tons, down from 62.6 million tons last year.
The average price of India's crude imports was $114.48 in April and $106.23 per barrel in May amid elevated global prices.
In June, the average price of India's crude imports stood at a lower $83.22 per barrel due to easing global prices.