India’s crude oil import bill rose by 12% during the first half of the fiscal year 2024-25, reaching $71.3 billion, compared to $63.7 billion in the same period last year, according to data from the Petroleum Planning and Analysis Cell. The country imported 120.5 million tonnes of crude oil between April and September, a 4% increase from 115.9 million tonnes during the same period in FY24.
In September, however, the import bill for crude oil decreased by 3%, despite a 6.3% rise in volume, with 18.6 million tonnes imported compared to September 2023. India’s reliance on imported crude oil increased to 88.2% in the first half of FY25, up from 87.6% in the same period last year, due to rising demand and stagnant domestic production. Local crude oil production during the period stood at 14.4 million tonnes, slightly lower than the 14.7 million tonnes produced during the same time in FY24. Analysts point to the maturing of existing oil fields and the lack of new production areas as contributing factors.
Despite government efforts to boost domestic production, the output has remained largely stagnant over the past decade. This has led to an increased reliance on imports. Recently, the government introduced a Bill in Parliament to amend the Oilfields (Regulation and Development) Act, 1948, expanding the definition of mineral oils to include hydrocarbons such as shale gas and coal bed methane. This amendment aims to attract more industry participation and investment.
Oil Minister Hardeep Singh Puri has stated on several occasions that the government is engaging with international oil companies to boost domestic production. During the conclusion of the 10th round of Open Acreage Licensing Programme (OALP) bidding, Puri emphasized the government’s intention to incentivize investment in seismic surveys and exploration projects.
Efforts to diversify crude oil sources continue, with India recently exploring opportunities to increase imports from Brazil. However, logistical challenges and competition from other suppliers may limit this expansion. India’s crude oil imports from Russia, Iraq, and Saudi Arabia remain the highest, with Russian crude accounting for over 40% of the country’s total imports this year.
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