In 2024, OPEC’s share of India’s crude oil imports increased for the first time in nine years, signaling a shift in the country’s sourcing strategy, according to a Reuters report.
While Russia maintained its position as India’s primary crude oil supplier, the data highlighted a growing reliance on OPEC member countries, the report said.
This development could be attributed to a variety of factors, including shifting geopolitical dynamics, price fluctuations, and the pursuit of a diversified energy mix.
The increase in the cartel’s market share may have implications for India’s energy security and its relationships with both OPEC and non-OPEC oil-producing nations.
Invezz had reported earlier this month that Russian crude oil exports to India dropped to a 17-month low in December, while imports from the Middle East and some African countries rose.
Additionally, fresh sanctions on Russian oil exports by the US are likely to further dent demand from India in the coming months.
India’s December oil imports
According to Vortexa, oil imports from Russia to India are likely to remain subdued in January as well.
India imported around 4.46 million barrels per day of crude oil in December, up nearly 4% on a month-on-month basis, according to data from Vortexa.
Reuters reports that while Russia’s share of India’s crude imports remained steady at approximately 36% in 2024, the Organization of the Petroleum Exporting Countries (OPEC) increased its share to roughly 51.5% from 49.6% in 2023.
Source: Reuters
There is higher demand for Middle Eastern barrels from Asia refiners, especially India, due to lower Russian supplies, Priti Mehta, senior research analyst at consultancy Wood Mackenzie was quoted by Reuters as saying.
Indian refiners have increased their procurement of crude oil from the Middle East since late 2024. This shift comes as a response to the declining availability of Russian oil supplies.
This increased reliance on Middle Eastern crude is reflected in the import data for December.
Oil market share
The share of Middle Eastern oil in India’s total crude imports during last month reached approximately 52%, marking a 22-month high, according to the report.
This figure highlights a significant shift in India’s crude sourcing strategy, driven by the evolving dynamics of the global oil market and geopolitical factors impacting supply chains.
Source: Reuters
In December, Russia maintained its position as the primary source of oil for India. This was followed by Iraq and Saudi Arabia, who held the second and third positions, respectively, in terms of oil supply to India during the same period.
In recent years, Russia has emerged as India’s primary oil supplier after the Kremlin invaded Ukraine.
This shift can be attributed to the attractive discounts offered on Russian oil following the imposition of a price cap by Western nations and their subsequent avoidance of purchasing from Moscow.
This geopolitical situation led to a significant decrease in OPEC’s market share in India, plummeting from 64.5% in 2022 to approximately 50% in 2023, Reuters said.
Indian refiners have been diversifying their crude oil purchases to cut costs, resulting in a steady decline in OPEC’s market share since 2016.
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