India's net oil and gas imports reported a substantial decline, reaching $68 billion in value terms for the period of April-October in the fiscal year 2023-24 (FY24), according to the latest government data, as reported by the Indian Express.
This significant reduction is attributed to the relatively subdued global prices of crude oil, natural gas, and petroleum products.
Despite an increase in import volumes during this period, the decline in prices appears to have offset the growth in volume.
In the corresponding seven months of the previous fiscal year—FY23—the country's net oil and gas import bill amounted to $90.1 billion.
The dip in the value of oil and gas imports is noteworthy, given the rise in import volumes. This trend suggests that the fall in prices played a crucial role in offsetting the volume growth.
Last year, international prices of oil, natural gas, and refined petroleum products surged following Russia's invasion of Ukraine in February 2022.
However, the prices have been relatively softer and less volatile in the current financial year.
For instance, the average price of the Indian basket of crude for April-October last year was almost $102 per barrel, whereas, in the same period of FY24, it stood at $83.44.
Apart from generally lower global prices of crude oil, India has also benefitted from increased imports of discounted Russian crude, even though the discounts are not as substantial as the previous year.
In the realm of natural gas, imported in liquefied form, the import value for the first seven months of FY24 was $6.6 billion, marking a nearly 30 per cent decrease from the previous year.
Despite being a net exporter of petroleum products, India heavily relies on imports of crude oil and natural gas due to high domestic demand and low production.
According to Petroleum Planning & Analysis Cell (PPAC) data, India's import dependency for crude oil was 87.6 per cent in April-October, up from 86.6 per cent a year ago, primarily due to rising consumption as domestic production remained stagnant.
Regarding natural gas, India's import dependency for the first seven months of the current financial year was 46.3 per cent, compared to 44.4 per cent in the corresponding period of the previous year.
Nayan Dwivedi is Staff Writer at Swarajya.
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