India to source most crude supplies from Gulf in near future: Hardeep Puri

Most of India’s crude oil supplies will come from Gulf countries, including Saudi Arabia, Iraq and the UAE, in the near future the world’s third largest oil importer seeks a secure and affordable energy base, India's minister of petroleum and natural gas, Hardeep Singh Puri, said.

Crude oil imports from Saudi Arabia by the world's third consumer nation rose in July by more than 25 per cent after Saudi Arabia lowered the official selling price in June and July compared with May. Saudi Arabia stayed at the third spot among India's suppliers.

"As far as India is concerned, I see for the foreseeable future much of our crude oil supplies will be coming from Saudi Arabia, Iraq, Abu Dhabi, Kuwait, among others," Puri was quoted in an interview on the sidelines of the Gastech conference in Milan.

India consumes around 5 million barrels of oil per day and this largely comes from Iraq, Saudi Arabia, Kuwait and the UAE.

Although oil imports from Russia declined by 7.3 per cent in July from the June levels, Moscow remained the country's second biggest oil supplier after Iraq.

Even as the European Union is mulling over a ban on Russian oil, India is gaining from the discounts offered by the country. As of August, India is receiving oil from Russia at a discount of $5-6 per barrel.

In August, Russia was India's third-largest oil supplier, meeting 18.2 per cent of all the country's oil needs. Saudi Arabia was India's largest oil supplier at 20.8 per cent and Iraq at 20.6 per cent. Supplies from Iraq fell 18 per cent in August, as compared to July.

Puri said that by the end of the fiscal year on March 31, 2022, India's purchases from Russia represented only 0.2 per cent, but rose later as the global situation became problematic.

"We started to buy a little more, but we still buy a fraction of what Europe buys from Russia. A democratically elected government like what we have in India will make sure that the consumers are provided with energy (not only) on a secure basis, but also on an affordable basis," he said.

Indian refiners have been snapping up relatively cheap Russian oil, shunned by Western companies and countries since sanctions were imposed against Moscow for what it calls a "special military operation" in Ukraine.

India's imports from Russia oil rose by 4.7 times, or more than 400,000 barrels per day, in April-May, but fell in July. During the June quarter, crude imports from Russia valued at $3.02 billion contributed 71 per cent of the total imports from the country ($4.2 billion).

China and India have increased their purchases of Russian oil following the Kremlin’s attack on Ukraine, benefiting from discounted rates.

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