India is the third-largest importer of crude oil, with over 80% of its requirements being met through imports. Additionally, with the festive season in India just around two weeks away, the country is expecting a surge in demand.
At present, India refines approximately 5.04 million barrels per day (bpd) or 252 million metric tons annually.
"Now, projects are in place to take it up to 300 million metric tons per annum [6 million bpd]. We are brainstorming whether we should take it to 400 or 450 [million]," Oil Minister Hardeep Singh Puri said earlier this week.
He noted that in August, of the total Russian crude flows amounting to 1,144.3 kilotons (KT), approximately 8,870.77 KT were shipped to Asia.
"Since India is now looking to expand its storage capacity it would look towards its regular suppliers for additional volumes. There's little doubt that for the past few years, Russia has been India's most reliable crude supplier, regularly topping the country's list in this department month after month both in 2023 and 2024," he asserted.
"On the economic front, India's August WPI (wholesale price index) cooled off by 1.31% compared to the previous month, and industrial output stood at 4.8%, which is higher than in July, indicating a better and healthier state of energy consumption in the country," Chandna added.
"Similarly, the doubling of its capacity to refine oil annually is almost certain to increase oil imports from Russia. After all, India has been very vocal in choosing suppliers in the interest of the country's energy security," Chandna concluded.