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The US is India’s sixth largest energy trade partner currently, including the fifth largest source of crude oil and second largest for LNG.
| Photo Credit:
AntonioSolano
India’s crude oil imports from the US rose to a two-year high in the 2024 calendar year (CY) as cargoes from the North American country helped bridge the deficit due to lower Russian shipments.
According to the US Energy Information Administration (EIA), India’s crude oil imports from the US rose by 32.74 per cent y-o-y to 223,000 barrels per day (b/d) in 2024. Cargoes in 2023 had hit a 5-year low of 168,000 b/d.
The US exports to Asia (overall) decreased by 131,000 b/d to 1.58 million b/d as increased exports to South Korea, Singapore and India were offset by the decrease in shipments to China, it pointed out.
Higher Indian cargoes
Crude oil exports to India increased 32 per cent in 2024, bouncing back from relative lows in 2023, the US agency said.
In 2023, India increased imports of relatively cheap crude oil from Russia, following sanctions that limited the price Russia could charge for crude oil exported using the shipping and insurance services of sanctioning countries, the US EIA said.
India’s oil consumption growth overtook China’s in 2024, increasing Indian demand for imported crude oil. However, despite this rising demand, Indian imports of crude oil from Russia fell in 2024 as the price discount on oil from Russia narrowed, it added.
“With the decrease in Russian imports, US crude oil helped fill in the gap, resulting in a nearly 55,000 b/d increase in US crude oil exports to India in 2024,” it said.
Tariffs & Trade
The US is India’s sixth largest energy trade partner currently, including the fifth largest source of crude oil and second largest for liquefied natural gas (LNG). Bilateral trade in hydrocarbons between the two hit $13.7 billion in FY24.
Oil and gas imports from the US will rise as India tries to balance its trade deficit with the former. However, LNG seems to have a higher scope.
US LNG supplies to India will grow in FY26 considering the new US administration views the commodity as not just a growth driver but also a geopolitical lever. The US wants to move deeper into India, Japan, South Korea and Taiwan.
India’s imports of LNG from the US surged to 256.05 billion cubic feet, or roughly 7.25 billion cubic meters (BCM), during 2024—the highest on record.
India generally imports light sweet crude oil from the US (WTI), which yields more petrol. Here, logistics and crude costs are the key. For instance, Middle East crude freight costs are around $1.50 per barrel, roughly one-third of the US costs.
In FY24, the US accounted for just 3 per cent of India’s cumulative crude oil imports, compared to its record share during the Covid years due to lower costs. During FY21, the US accounted for 7.31 per cent of India’s total imports, which rose to 8.21 per cent in FY22.
Published on April 15, 2025
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