India’s crude oil imports during April 2024 rose to its third highest level on record as refiners topped up on supplies to meet the domestic demand for auto fuels as well as for export opportunities in the northern hemisphere ahead of the summer travel season.

The world’s third largest energy consumer imported 21.4 million tonnes (mt) of crude oil last month, a growth of 3 per cent M-o-M and 7 per cent Y-o-Y. Inbound shipments of the critical commodity rose for the third consecutive month during April, according to Petroleum Planning & Analysis Cell (PPAC) data.

Prior to this, Indian refiners imported an all-time high of 21.6 MT in April 2022, followed by 21.5 MT in January this year.

Analysts and trade sources attribute the higher numbers to more export volumes being shipped out of Russia and Chinese refiners lifting of lower cargoes, which increased Russia’s share in total imports to 40 per cent from roughly 30 per cent in March 2024.

Refiners lift more cargoes

According to energy intelligence firm Vortexa, India imported more than 1.72 mb/d crude oil from Russia in April, the highest amount in the last nine months.

Private refiners, Reliance Industries (RIL) and Rosneft-backed Nayara Energy, imported around 770,000 barrels per day (b/d) of crude oil from Russia in April 2024, the highest in a year.

Sensing the opportunity to procure more barrels, public refiners such as Indian Oil Corporation (IoC), Bharat Petroleum Corporation (BPCL), and Hindustan Petroleum Corporation (HPCL) too imported 1.02 million barrels per day (mb/d) last month, which is a seven-month high.

Higher import bill

Brent crude oil prices averaged $90.15 per barrel in April 2024, up from against $85.48 in March 2024 and $84.94 a year ago. The Indian basket crude price averaged at $89.46 a barrel last month, up from $84.49 in March 2024 and $83.76 in April 2023.

Consequently, India’s oil import bill rose last month. The net import bill for oil and gas rose from $10.1 billion in April 2023 to $12.3 billion in April 2024. Crude oil imports constituted $13 billion, LNG imports $1.1 billion and exports were $3.7 billion in April.

Earlier this month, state-run Bharat Petroleum Corporation (BPCL) said that Russian supplies have moderated, compared to FY24. The oil marketing company (OMC) said that discounts have almost halved to $3-6 per barrel, from an average of $8-10 during FY24.

However, trade sources noted that the Ukranian drone attacks on Russian refineries are making more crude oil supplies available for exports. According to the US EIA, around 14 per cent of Russia’s refining capacity came offline in the first quarter of 2024.

“This will make more supplies available for exports to India. In April, more supplies were available due to drone attacks and lower imports from China. May should follow suit,” said one of the sources.

Vortexa’s Head of APAC Analysis, Serena Huang, told businessline “Higher Russian crude exports in February and March as well as lower imports by Chinese refiners have made available more volumes for Indian refiners. Given that Russian crude cargoes are likely to be more discounted than Middle East grades, Indian refiners are likely to opt for the former.”