MUMBAI: In addition to Indian refiners resuming their procurement of crude oil from the West Asia, Guyana, Brazil, the US, and Canada, US President Donald Trump’s new salvo on Monday could mean that refiners will have to seek new markets for their refined products derived from crude oil.
Less than a week after the US announced a 25% tariff on imports from India “plus a penalty”, Trump on Monday again raised the issue of India buying oil from Russia and profiting from it, adding that he would be “substantially” raising the tariff “paid by India to the USA”.
Thus far, the European Union and the US were the largest markets for refined petroleum products, largely petrol, diesel, and aviation turbine fuel (ATF) among others.
Before the start of the Russia-Ukraine war, Indian refiners imported 85% of crude oil from the Gulf countries, and Russian oil accounted for less than 0.2% of India’s imports at $5.2 billion. But after the war began, this share went up to 35-40% of the country’s crude intake, helping reduce overall energy import costs and contain inflation. By the end of December 2024, imports from Russia climbed to $56 billion, a nearly 10-fold increase.
According to the Petroleum Planning and Analysis Cell, under the Ministry of Petroleum and Natural Gas, last fiscal year India’s exports of petroleum products grew by 3.4% in volume terms to 64.7 million tonnes in FY25, on the back of increased shipments of motor spirit (petrol), petcoke, and fuel oil.
However, in value terms, the exports declined by almost 7% to $44.3 billion during the fiscal year compared with $47.7 billion in the year ago. The dip in export value was due to subdued prices in the current year.
