India's Oil Import Bill To Top $100 Billion In Current Fiscal

Country's crude oil import bill is set to cross $100 billion mark in the current financial year, which would be almost double than that of last year's, as global crude prices touched seven-year high levels.

According to data provided by Petroleum Planning and Analysis Cell (PPAC), India spent $94.3 billion in the first 10 months (April-January) of current fiscal (2021-22) on oil imports.

It spent $11.6 billion in January 2022 alone when oil prices had started to surge. In comparison to this, the country had spent $7.7 billion on oil imports in January 2021.

This month, oil prices crossed $100 per barrel and going at this rate, India, which imports 85 per cent of its crude oil requirements, is expected to almost double its import bill to $110-115 billion by the end of the fiscal year 2021-2022.

The imported crude oil is turned into value-added products like petrol and diesel at oil refineries, before being sold to automobiles and other users. India has surplus refining capacity and it exports some petroleum products but is short on production of cooking gas LPG, which is imported from nations like Saudi Arabia.

Import of petroleum products in April-January of 2021-22 fiscal was 33.6 million tonnes worth $19.9 billion. On the other hand, 51.1 million tonnes of petroleum products were also exported for $33.4 billion.

India had spent $62.2 billion on import of 196.5 million tonnes of crude oil in the previous 2020-21 fiscal when global oil prices remained subdued in the wake of the COVID-19 pandemic.

In the current year, it has already imported 175.9 million tonnes of crude oil.

Meanwhile Brent spot prices surged to an over seven-year high of $105.58 per barrel on February 24 on fears of supply disruptions after Russia invaded Ukraine. It has dropped to below $100 thereafter as those fears receded as the West kept energy trade out of sanctions imposed on Russia.

Higher crude oil import bill is expected to dent the macroeconomic parameters.