India's Crude Oil Import Bill to Jump by 25% in 2017-18

India’s oil import bill is likely to jump by a quarter to $87.7-bn in the current fiscal year which ends on March 31 as international oil prices have surged.

India had imported 213.93 million tonnes (mt) of crude oil 2016-17 for $70.196-bn or Rs. 4.7 lakh crore. For 2017-18, the imports are pegged at 219.15-mt for $87.725-bn (Rs. 5.65lakh crore), according to the latest data available from Oil Ministry’s Petroleum Planning and Analysis Cell (PPAC). India relies more than 80 per cent on imports to meet its oil needs.

During first 11 months of current fiscal (April 2017 to February 2018), the country imported 195.7-mt crude oil for $63.5-bn. The basket of crude oil that India imports averaged $55.74 per barrel in the April-February period as compared to $47.56 a barrel in 2016-17 and $46.17 in 2015-16.

“April 2017-February 2018 crude oil imports are based on actuals and for March 2018, crude oil imports are estimated at crude oil price $65 per barrel and exchange rate Rs. 65 to a US dollar,” PPAC said. Every dollar per barrel change in crude oil prices impacts the import bill by Rs. 823-crore ($0.13-bn). The same is also the impact when currency exchange rate fluctuates by Re 1 per US dollar.

Production and consumption

Domestic crude oil production was almost flat at 32.6-mt in the April-February period. It was 36-mt in whole of 2016-17 and 36.9-mt in the previous fiscal. As against this, domestic consumption has been rising – from 184.7-mt in 2015-16 to 194.6-mt in 2016-17. It was 186.2-mt in first 11 months of 2017-18, according to PPAC. Data also showed that the share of high sulphur crude in total crude oil processed increased to 75 per cent during April-February, from 72.4 per cent in the corresponding period a year ago. The trend indicates the increasing complexity of state-run refineries.