Meanwhile, India's natural gas production edged up to 32.9 billion cubic metre (BCM) in 2018-19, from 32.6 BCM in the previous year.
Making use of the leniency accorded by the US since it re-imposed sanctions on oil imports from Iran in November last year, Indian refiners have managed to import 22.8 million tonne of crude oil from the Persian Gulf nation in FY19, marginally higher than 22.6 MT imported in FY18. Iran retained the tag of being the third highest crude oil supplier to India last fiscal.
It must be noted though that 80% of FY19 imports from Iran was done by the end of October before imports were restricted to 300,000 barrels per day. Clearly, had there been no restrictions, oil imports from Iran would have hit 27 MT in FY19.
The toughening of the US stance now (removal of the part waiver effective May 2) will have an adverse impact on India’s crude import bill as apart from an overall price spike, New Delhi may have to tap costlier options to source the crude varieties that best suit its main refineries.
Interestingly, oil exports from the US to India shot up a staggering 328% to 6 MT in FY19 compared with 1.4 MT in FY18. In terms of rankings, the US entered the top 10 oil exporting nations list to India at 9th position, galloping nine spots from its 18th rank in FY18.
Imports from the US are likely to go up in the current financial year as Indian Oil has signed an annual contract to buy 60,000 barrels of US crude oil per day during FY20. Earlier, Indian refiners mostly relied on spot buys for US oil. With Iran crude oil tap going dry for India, other refiners including MRPL — which sources 25% of its crude oil requirement from Iran — will also be exploring oil imports from the US, as reported by FE.
India’s total crude oil imports for FY19 was marginally down to 209.4 MT compared with 218.1 MT in FY18, according to data from the Directorate General of Commercial Intelligence and Statistics, an arm of the ministry of commerce and industry. At the same time, India produced 34.2 MT of crude oil in FY19, down from 35.7 MT in the previous year.
Despite India’s oil imports inching down, the cost of oil import went up from $87.4 billion in FY18 to $107 billion in FY19 as average annual crude oil price went up from $57.85 per barrel to $70.86 per barrel. In rupee terms, the oil cost shot up from `5.63 lakh crore in FY18 to `7.5 lakh crore in FY19 as rupee averaged 64.46 against the dollar in FY18 compared with 69.89 in FY19.
Meanwhile, India’s natural gas production edged up to 32.9 billion cubic metre (BCM) in 2018-19, from 32.6 BCM in the previous year.
US President Donald Trump reimposed sanctions on Iran last year by revoking the deal between the Persian Gulf nation and other European nations apart from the US, signed in 2015. While some sanctions came into effect immediately on August 6, 2018, oil related sanctions came into force from November 2, 2018. However, eight nations, including India, were given waiver till May 2 to import restricted quantity of crude oil from Iran.
Trump, however, last week declared the country will not extend the waiver for existing importers of Iranian oil.