India’s crude oil import dependency rose to an all-time high of 90.6 per cent for the second consecutive month during May 2025 as the world’s third largest importer procured record number of cargoes during the month.
Prior to this, India imported a record 90 per cent of its crude oil requirement during April 2025. Trade sources said that cargoes are also on the higher side for June, pushing up inventory levels of domestic refiners.
According to the Petroleum Planning & Analysis Cell (PPAC), India’s import dependency of crude oil, on POL (Petroleum, Oil & Lubricants) basis rose to its highest on record at 90.6 per cent in May 2025 compared to 87.5 per cent and 86.2 per cent during the same month in 2024 and 2023 calendar years (CYs), respectively.
Indian refiners imported 23.3 million tonnes (mt) crude oil last month, an all-time high, against the previous highs reported in March 2025 (22.70 mt) and April (21.23 mt). In fact, crude oil imports averaged at 21.58 mt for the first five months of the current CY.
During FY25, India’s crude oil import dependence rose to 88.2 per cent compared to 87.8 per cent and 85.5 per cent during FY24 and FY23, respectively, PPAC data said.
Higher imports
The higher imports, since the beginning of the year and during May, are also a reflection of the growing consumption of refined products, particularly diesel, petrol and jet fuel.
India’s diesel and petrol consumption rose to an all-time-high record in May, largely aided by robust manufacturing activity, exporters rushing to fulfil orders before close of the US reciprocal tariff deadline as well as some uptick from farm activity due to early monsoon and marriage season.
Between January and May this year, India’s consumption of refined petroleum products averaged at 20.41 mt.
Besides, lower crude oil prices also prompted refiners to top up on cargoes. The price of Brent Crude averaged $64.22 a barrel during May against $67.79 during April and $82.05 during May 2024.
The Indian basket crude price averaged $64.04 a barrel during May as against $67.73 during April and $83.62 during May 2024.
Declining production
Rising crude oil imports from India are not only due to the growing demand for refined products, but also points to the continuously-declining production. Indigenous crude oil and condensate production during May was 2.4 mt, registering a de-growth of 1.7 per cent year on year.
According to the recently-published India Energy Scenario report, brought out by the Bureau of Energy Efficiency (BEE), crude oil production that accounts for roughly one-fourth of India’s gross imports declined 3 per cent per annum in the last seven years, till FY24.
“In FY24, the domestic production of oil was 29.4 mt, decreasing significantly from 36 mt in FY17, at an annual rate of 3 per cent,” the report said.
It attributed the decline to several factors, including natural depletion of older and marginal fields, accessibility and technical challenges in certain reservoirs, disruptions in field activities, etc.
ONGC and OIL contributed around 65 per cent and 11 per cent, respectively in FY24 with the remaining crude oil being produced by the Production Sharing Contracts or Revenue Sharing Contracts regime.