Even the recent oil purchases show India and the US have improved their relationship. India has gradually expanded its exports of the essential commodity from the US, which is regaining its lost market dominance, while crude oil imports from Russia show signs of standstill. Apparently as a result of voluntary output restrictions by the second-largest crude oil producer in the world, India's imports of crude oil from Russia declined 8% month over month to 1.798 million barrels per day (mb/d) in June from a record 1.96 mb/d in May, according to energy intelligence company Vortexa.
Steady rise- Vortexa's data also reveals that since March of this year, imports from the US have been steadily increasing. India bought 406,000 barrels per day (bpd) from the US in January 2023. This number plummeted to 244,000 bpd a month later, and then dropped precipitously to 100,000 bpd in March. India's imports from the US increased to 119,000 bpd in April, and then to 138,000 bpd the following month. The shipments then increased by a respectable 62% to reach 224,000 bpd in June.
India's total crude imports have decreased from the highs recorded in February to an average of 4.8 mb/d in April, according to OPEC's monthly oil market report. This reflects a monthly decrease of 55,000 bpd, or around 1%. Crude inflows decreased by 0.4 mb/d, or about 8%, on a year over year basis. Petroleum Planning and Analysis Cell (PPAC), India imported about 40 million tonnes (mt) of crude oil overall in April and May, 6.9% of which came from North America. Prior to the start of the Russia-Ukraine conflict in February 2022, North America's share was roughly 14%. In the second part of 2017, India started importing crude oil from the United States.
Diversifying sources- The Commerce Ministry, India bought crude oil from the US for $4.9 billion in FY20, making it the country's fourth-largest supplier. The US also ranked fourth in terms of crude oil suppliers in FY21 and FY22, with cargoes valued $5.40 billion and $11.32 billion, respectively. With $10.18 billion in crude exports, it ranked sixth in FY23.
According to a January 2023 analysis by S&P Global Commodity Insights, the US' proportion of India's crude oil basket increased from 5 to 6 percent in April 2022 to almost 10 percent in November 2022. According to a joint study by KPMG India and the American Chamber of Commerce (Amcham) India, India is looking to diversify its crude sources and is primarily focusing on reducing its reliance on Middle Eastern crude. This move has been prompted by the Organisation of the Petroleum Exporting Countries (OPEC)+ announcement on cutting crude oil output. According to the study, which was published in May 2023, this situation has significantly helped the import of oil from the US, which has recently seen a rise.
