Last Updated:
More domestic output can’t end India’s import dependence, but it can reduce the need for overseas crude.
Venezuelan oil has returned to India’s import mix after purchases resumed in April. The increase has been particularly sharp in recent months.
India is trying to make sure a disruption in one part of the world does not leave its refineries short of crude. With the Iran conflict affecting supplies and uncertainty around the Strait of Hormuz, Indian refiners are buying more oil from countries farther away, particularly in Latin America and Africa.
The change is already visible in India’s import numbers. Venezuelan crude has surged in August, making Venezuela the country’s fourth-largest supplier. Kpler data cited by PTI put Venezuelan supplies at around 444,000 barrels per day (bpd). Imports from the US stood at about 153,000 bpd, while Iraq supplied around 118,000 bpd.
Russia Still Leads The Supply Chain
The search for new sources does not mean India has moved away from Russian oil. Russia continues to be the country’s biggest supplier, with imports approaching 2 million bpd in August.
Russian shipments were even higher in June and July, when they stood at roughly 2.6 million bpd. In July, Russian crude accounted for more than half of India’s total oil imports.
At the same time, refiners have been adding barrels from Venezuela, Brazil and African producers as they deal with uncertainty over supplies from the West Asia.
India has continued importing around 5 million bpd of crude in recent months, allowing its refineries to keep running despite the disruption in global supply routes.
Why Venezuela Is Becoming Important
Venezuelan oil has returned to India’s import mix after purchases resumed in April. The increase has been particularly sharp in recent months.
Between April and July, crude from Latin America made up 12.7% of India’s imports, compared with 3.5% during the same period last year. Over the same period, the West Asia’s contribution dropped from 43% to around 30%.
For India, the change is less about abandoning one region and more about having more options when supplies are disrupted.
Kpler senior manager Sumit Ritolia said India’s response is taking place on several fronts, including higher domestic output, more suppliers and shipping routes, larger inventories and greater use of alternatives such as gas, biofuels, electric vehicles and renewable energy.
Gulf Oil Is Still Hard To Replace
There is, however, a limit to how far India can shift its crude purchases away from the Gulf.
West Asian producers have a major advantage: they are geographically much closer to India. Oil travelling from the Gulf reaches Indian refineries faster and usually costs less to transport than crude coming from Venezuela, the US, West Africa and other distant markets.
Longer journeys also mean higher exposure to freight and insurance costs. So while buying from more countries can reduce the risk of depending too heavily on one source, it cannot completely protect India from a global supply shock.
India’s large dependence on imported oil means a major disruption can still result in higher crude prices, shipping costs and ultimately a bigger import bill.
Why India Still Needs Oil
A rapid shift away from crude is difficult because oil remains deeply linked to India’s economy.
Petrol and diesel are still central to road transport, while airlines, factories and the petrochemical industry also depend heavily on oil-based products. Even a rapid rise in electric vehicle sales would take years to significantly change demand because millions of petrol and diesel vehicles are already on Indian roads.
Other alternatives are also not yet large enough to fill the gap. Natural gas, biofuels and renewable energy are expanding, but they cannot currently replace oil across India’s entire energy system.
Domestic Production Becomes Part Of The Answer
That makes domestic production another important part of India’s energy-security plans.
Increasing output within the country cannot remove India’s dependence on imported crude, but every additional barrel produced domestically reduces the amount India needs to source from overseas.
It can also provide some protection against sudden international price increases, geopolitical disruptions and expensive shipping.
The government is therefore looking to expand exploration and bring more domestic oil and gas discoveries into production.
The Problem Goes Beyond Crude
India’s exposure to West Asia is not limited to crude oil. LPG supplies are particularly dependent on the region, while LNG can also face supply risks because replacing shipments and changing transport routes can be difficult.
That means energy security will have to cover more than crude imports. Gas supplies, storage capacity and strategic reserves will also become increasingly important.
The latest disruption is also likely to put India’s Strategic Petroleum Reserves under greater scrutiny, particularly over whether existing stocks would be enough if supply problems continued for an extended period.
Diversification, Not An Exit From Oil
For now, India’s approach is not to stop importing oil but to make those imports less vulnerable to a single crisis or supply route.
That means buying from more countries, increasing domestic production, maintaining larger reserves and developing alternatives such as EVs, gas, biofuels and renewables.
Oil, however, is likely to remain a major part of India’s energy mix for years. With the economy and energy demand continuing to grow, the immediate goal is not to eliminate crude, it is to ensure that India can keep getting it even when global supply routes come under pressure. A
Key Questions Answered
Ask News18Prolonged disruption in Venezuela’s oil output, combined with ongoing risks in Middle East supply routes, could tighten global crude markets and push prices higher. India’s strategy of diversifying its oil imports, including increased purchases from Venezuela, aims to secure its energy supplies and reduce vulnerability to disruptions.
Ask News18About the Author
Anushka Vats is a Sub-Editor at News18.com with a passion for storytelling and a curiosity that extends beyond the newsroom. She covers both national and international news. For more stories, you can …Read More
August 20, 2026, 7:43 PM IST
Read More
Source link
[ad_3]
