India's crude oil imports from US dip by one million tonnes in June quarter

At the same time, share of Russian oil in India's crude basket rose from 2.2% in FY22 to 12.9% in the first quarter of FY22

India slashed its crude imports from the US by around one million metric tonnes (MT) in the June quarter of FY23 while it ramped up imports of the discounted crude oil from sanctions-hit Russia.

While the share of the US in India’s crude import basket was 9.2 per cent in FY22, in the first quarter of FY23 (Apr-June), its share declined to 5.4 per cent. During the corresponding period, the share of crude imports from Russia rose from 2.2 per cent to 12.9 per cent.  

During the Trump presidency, India started buying crude from the US to address Washington's complaint about the trade surplus New Delhi enjoys. President Trump, who pursued an “America First" approach, had been personally very vocal about the perceived high tariff walls that India put and often called out the country terming it “tariff king". India continued the high level of crude oil imports from the US even under the Biden administration.

Till FY17, India didn’t import any crude oil from the US while in FY18, the share of crude imports from the US was 0.7 per cent of total imports of the commodity from India. It gained pace quickly touching 4.8 per cent in FY20 and 9 per cent by FY21.

However, in the June quarter, crude oil imports from the US dropped to 3.4 million MT from 4.4 million MT during the same period a year ago, data from the commerce ministry showed.  

India’s rising dependence on Russian oil comes in the backdrop of the sanctions-hit nation offering discounted oil. In the June quarter, Russia became the third largest crude oil supplier to India, after Iraq, Saudi Arabia, and ahead of the United Arab Emirates (UAE), which had always been one of India’s significant oil suppliers.

During the June quarter, crude oil imports from Russia ($3.02 billion) contributed 71 per cent of the total imports from the country ($4.2 billion).

Last week, External Affairs Minister S Jaishankar again defended India’s decision to buy discounted Russian oil, saying many suppliers have diverted their supplies from Europe, which was buying less oil from Russia. “It is a situation today where every country will try to get the best deal possible for its citizens, to try to cushion the impact of high energy prices. And that is exactly what we are doing. I have a country that has a per capita income of $2,000. These are not people who can afford higher energy prices,” Jaishankar said at the 9th India-Thailand Joint Commission Meeting.

Responding to a question on India-Russia ties, US state department spokesperson Ned Price on Tuesday said India shares a historical relationship with Russia and it would be a long-term proposition to re-orient its foreign policy from Russia. "It is not for me to speak about another country's foreign policy. But what I can do is point out what we have heard from India. We have seen countries around the world speak clearly, including with their votes in the UN General Assembly against Russia's aggression in Ukraine. But we also recognise, as I was saying just a moment ago, that this is not flipping a light switch," US State Department spokesperson Ned Price told reporters.