India’s Union Minister for Petroleum and Natural Gas, Hardeep Singh Puri, has expressed confidence in the country’s ability to meet its increasing energy demands with a diverse range of oil sources. He highlighted India’s expansion of its procurement base from 27 suppliers to 39, providing the country with more choices in the global oil market. Puri assured that there is currently more oil available worldwide than is being consumed, minimizing the risk of shortages in the short to medium term.
With global oil markets facing scrutiny due to geopolitical and economic factors, India has taken a proactive approach to securing its oil supply. In July 2024, Russian crude accounted for a record 44 per cent of India’s total imports, reaching 2.07 million barrels per day. This marked an increase from the previous month and the same period in the previous year, showcasing India’s reliance on diverse sources for oil imports.
India’s oil marketing companies (OMCs) are projected to increase the country’s crude oil refining capacity by 35-40 million tonnes by the end of fiscal 2030, bringing the total installed refining capacity to 295 MT. The expansion is driven by growing domestic oil demand, with existing refineries already operating at high capacity utilization. The project is estimated to require a substantial capital investment, with most of the new capacity coming from brownfield expansions.
Over the last decade, India’s refining capacity has expanded by 42 million tonnes, reaching 257 MT in fiscal 2024. This growth has been fueled by increasing domestic demand, with petroleum product consumption rising at a CAGR of 4 per cent over the past ten years. Despite stable export levels, India’s focus has been on meeting domestic energy needs, leading to investments in expanding refining capacity to keep up with growing demand.
In conclusion, India’s proactive stance in diversifying its oil procurement base and expanding refining capacity reflects its commitment to meeting the country’s rising energy demands. With a strategic position in the global oil supply chain and a focus on securing stable energy sources, India is well-equipped to navigate the challenges and opportunities in the evolving global oil market. As the country continues to invest in expanding its refining infrastructure, it is poised to enhance its energy security and contribute to meeting the energy needs of its growing population.
