India’s Dependency On Imported Crude Oil Price Rises

Amidst the growing shift to other fuels and electronic vehicles, India’s economy is witnessing a rise in the demand for petroleum products and fuel. With the growing demand, India is also witnessing stagnancy in domestic crude oil production. This has led to an increased reliance on imported crude oil to meet the needs. This dependency on imported crude oil has risen from 85% in the past year to 87% in April-January.  

Statistics by Petroleum Planning & Analysis Cell (PPAC) revealed not only the rising trend but also stated that this trend will continue to increase till the last few months of the fiscal year. An all-time high was witnessed in Russian oil imports amidst the rising crude oil demands. India imported 1.4 million barrels per day in January. Saudi and Iraq oil imports followed close by. 

The report by PPAC proved the fact that the discrepancy between domestic demand and domestic crude oil production led to a rise in import dependency. According to reports, domestic consumption rose to 183.3 million tonnes while domestic crude oil production fell to 24.6 million tonnes. This mismatch between consumption and production led to a rise in dependency on crude oil to 87%. Data shows that the imports rose to 192.4 million tonnes as opposed to 175.8 million tonnes in the year 2021-22. 

Also, Read Russia-Ukraine War: Shares Rebounded, Crude Oil Surged $110/bbl

With a strong inclination towards electric vehicles and cleaner fuel, India is also marching in the direction of sustainability. India is taking considerable measures to reduce dependency on imported crude oil and make domestic production sufficient to meet its needs. There are a few hurdles in the way towards self-sufficiency and reducing crude oil needs, but with continuous efforts and innovation, we can expect favourable results. 

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