India’s crude import bill declined by 17% in the first month of FY26, reaching $10.8 billion compared with $13 billion in the year-ago period, according to data from the government’s petroleum planning and analysis cell.
The country imported 21.2 million tonne of crude oil in April, a marginal decline of 1% year-on-year. India’s reliance on crude oil imports increased to 90% during the month, up from 88.5% in April 2024, amid rising demand.
India’s import of Russian oil touched its highest level since May 2023 in April despite US sanctions due to their favourable free-on-board (FOB) discounts relative to West African and West Asian barrels, according to data from global real-time data and analytics provider Kpler. The country’s market share in Indian imports rose to 40% in April, up from 39% a year ago. Russian oil imports for April are estimated at 2.1 million barrels per day.
Even with longer haul and shadow fleet reliance, Russian barrels remain $3-8/bbl cheaper than West Asian or US grades on a landed-cost basis, as per analysts.
While Russia still remains the top supplier, several Indian oil and gas companies have started seeking alternative sources for oil supplies, particularly from the US, amid global uncertainty and continued US sanctions on Russia. However, with concerns of declining oil production in the US, India’s plan of increasing US imports of oil may be hit, analysts say. Slowing global oil demand amid extreme uncertainty about the future of US trade and a coming supply surplus are expected to hobble US oil production growth later this year and could lead to an annual decline in output in 2026, according to a new analysis by S&P Global Commodity Insights.
India has also been gradually increasing its intake of Brazilian grades like Tupi and Búzios which are cost-competitive and suit domestic refining slates. India currently relies on imports for 88% of its crude oil and 50% of its natural gas needs. To reduce this dependency, the government is emphasising on increased domestic exploration and production.
With the recent amendments to the Oilfields (Regulation and Development) Act, 1948, the government expects increased participation from domestic and international players. The amendment broadens the definition of mineral oils which includes any naturally occurring hydrocarbon, coal-bed methane, oil shale, shale gas, etc. In fact, a consortium of state-owned Oil and Natural Gas Corp (ONGC), and Reliance Industries and global energy major bp won for the first time an offshore oil block in Gujarat in the ninth round of bidding under the open acreage licensing policy. While ONGC won a majority of the blocks — 11 on its own and another four with different partners — Vedanta’s Cairn Oil and Gas won seven oil blocks, showcasing increased private sector participation in the sector.