India's crude oil import bill drops 16% but import dependency hits new high

India's crude oil import dropped 16 per cent in the fiscal year ended March 31 as lower international rates but the dependency on overseas suppliers rose to a new high, official data showed.

India imported 232.5 million tonnes of crude oil, which is refined into fuels like petrol and diesel, in the 2023-24 fiscal (April 2023 to March 2024), almost the same as in the previous financial year. But it paid USD 132.4 billion for the imports in FY24 as against USD 157.5 billion import bill in 2022-23, oil ministry's Petroleum Planning and Analysis Cell (PPAC) data showed.

The world's third largest oil importing and consuming nation has been able to add to its domestic production drop, raising its import dependence. Import dependence of crude oil soared to 87.7 per cent in 2023-24, up from 87.4 per cent, according to PPAC. Domestic crude oil production was almost unchanged at 29.4 million tonnes in 2023-24.

Besides crude oil, India spent USD 23.4 billion on import of 48.1 million tonnes of petroleum products like LPG. It also exported 62.2 million tonnes of products for USD 47.4 billion. Other than oil, India also imports gas in its liquid form, called LNG.

After the price shock of 2022-23, import of 30.91 billion cubic meters of gas cost USD 13.3 billion in the fiscal year ended March 31, 2024.

This compared with USD 17.1 billion spent on import of 26.3 bcm of gas in 2022-23 when energy prices shot up to record levels in the aftermath of Russia's invasion of Ukraine.

Net oil and gas import bill (crude oil plus petroleum product plus LNG import bill minus exports) stood at USD 121.6 billion in 2023-24, down from USD 144.2 billion. Petroleum imports as percentage of India's gross imports (in value terms) stood at 25.1 per cent, down from 28.2 per cent in 2022-23.

Similarly, petroleum exports as a percentage of the country's gross exports came at 12 per cent in 2023-24 as compared to 14 per cent in the previous year. India's fuel consumption rose 4.6 per cent to a record 233.3 million tonnes in the year ended March 31, 2023. This compared with 223 million tonnes consumption in 2022-23 and 201.7 million tonnes in 2021-22.

While the country is short in crude oil production, it has surplus refining capacity which enables export of petroleum products like diesel. Against the consumption of 233.3 million tonnes, petroleum product production was 276.1 million tonnes in 2023-24, PPAC data showed.