India’s crude oil imports in April rose by 7% to 21.44 million metric tons year-on-year, boosted by firm demand and discounted Russian fuel, government data released on Wednesday showed.

On a monthly basis, imports gained 3.6% from 20.69 million tons in March.

WHY IS IT IMPORTANT?

India is the world’s third-biggest oil importer and consumer. In April its fuel consumption rose by 6.1% year-on-year.

BY THE NUMBERS

Data from the Petroleum Planning and Analysis Cell’s (PPAC) website showed imports of crude oil products jumped 35% to 4.26 million tons on a yearly basis while product exports increased over 9% to 4.78 million tons over the same period.

KEY QUOTE

Besides solid economic activity, the increase in Indian refined product exports is likely another factor supporting imports which are likely to keep rising over the coming months amid stalling domestic crude production and rising oil consumption, said analyst Giovanni Staunovo of UBS.

“The discount level of Russian crude oil versus international benchmark prices might be a factor influencing imports quantity.”

CONTEXT

In April, a ship controlled by U.S.-sanctioned Russian shipping giant Sovcomflot (SCF) discharged fuel oil at a western Indian port, two sources familiar with the matter said, indicating a resumption in the use of SCF vessels to supply Moscow’s key market after a brief halt.

India’s Reliance Industries, has signed a one-year deal with Russia’s Rosneft to buy at least 3 million barrels of oil a month in roubles, four sources aware of the matter said.

Following the 2022 invasion of Ukraine by Russia, which led to the West imposing sanctions and ceasing purchases, India has emerged as the largest importer of seaborne Russian crude.

Elsewhere, traders and analysts expect OPEC+ to keep voluntary production cuts totalling about 2.2 million barrels per day in place.

Source: Reuters reported by Ashitha Shivaprasad and Sherin Varghese in Bengaluru and edited by Shri Navaratnam