OPEC’s share of India’s crude imports fell last year to the lowest in at least 15 years, as the world’s third-largest oil importer bought more crude from North America to offset the inability to buy from Iran and Venezuela, Reuters said, based on data obtained from industry sources.
OPEC continued to hold the largest share of India’s oil imports, but that share fell to 70% last year. By way of comparison, in 2008, India’s crude oil imports from the organization’s producers amounted to 87%.
India has been trying to diversify its oil imports for years, seeing heavy import dependence on OPEC as a geopolitical risk. The country has had to stop buying from OPEC members Iran and Venezuela for the past two years due to US sanctions. Indian refiners chose to abide by the sanctions regime and not give the United States reasons for possible secondary sanctions or to cut Indian companies off from the American financial system and markets.
Lack of crude from Venezuela and Iran was one reason OPEC’s share of Indian oil imports fell last year to the lowest since at least 2007. The other was that Indian refiners opportunistically imported more crude from the United States and Canada when arbitrage allowed and prices were favourable.
India is one of the most price-sensitive major oil importers and last year repeatedly called on OPEC and OPEC+ to increase production more than expected in order to bring down international crude oil prices.
Early last year, India called on the OPEC+ group to increase production, saying it did not support “artificial cuts to keep prices rising”.
As oil prices recovered in early 2021, India began calling on OPEC+ as early as January to examine the effects of rising oil prices on consumption in recovering economies.
By Tsvetana Paraskova for Oilprice.com
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