India spent Rs 93,466 crore (USD 12.4 billion) on importing 57.2 million tonnes of crude oil in the April-July
Another factor which contributed to the 63 percent cut in India’s oil import bill was a slump in demand
New Delhi: In the backdrop of the historical drop in global crude oil prices, India’s crude oil import has fell by 63 percent in the first four months of the current financial year, Union Minister for Petroleum and Natural Gas Dharmendra Pradhan told the Lok Sabha on Tuesday. According to the data shared by Pradhan in a written response in the Lok Sabha, India spent Rs 93,466 crore (USD 12.4 billion) on importing 57.2 million tonnes of crude oil in the April-July period as opposed to Rs 2,51,679 crore (USD 36.2 billion) on importing 74.9 MT in the corresponding period of the previous fiscal.
To put the numbers into perspective, crude oil imports for India fell from USD 64.31 per barrel in January to USD 19.90 a barrel in April, and then rose again to settle at USD 43.35 per barrel in July. India imports 85 percent of its total crude oil requirement.
Unprecedented fall in demand during lockdown: Pradhan
Responding to another question, the minister said, “COVID-19 pandemic has resulted in unprecedented fall in demand which in-turn has reduced revenue consequent to lockdown imposed in the country.” In April, the consumption of petroleum products dropped to 9.89 MMT as a nationwide lockdown was imposed to contain the spread of Coronavirus. Pradhan said that some recovery in demand for petroleum products was witnessed in May when it rose to 14.63 MMT and to 16.25 MMT in June.
Another factor which contributed to the 63 percent cut in India’s oil import bill was a slump in demand. Even though in the immediate aftermath of the historical fall in crude oil prices, India bought oil to fill all its storage capacity, nonetheless, the import bill was still short for each month when compared to the year-ago period. India spent just USD 3.1 billion on the import of 16.6 million tonnes of crude oil in April. This compares with USD 9.7 billion spent on the import of 19.7 million tonnes of crude oil in April 2019. The May crude oil import bill was lowest in many years at USD 2.3 billion. It was at USD 9.5 billion in May 2019.
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