India’s US Crude Oil Imports Jump 50% in H1 2025

India’s US Crude Oil Imports Jump 50% in H1 2025

Why in News? 

Recently, India’s crude oil imports from the United States surged by over 50% in the first half of 2025. This sharp rise highlights growing energy ties between the two nations. As global markets shift, India is clearly turning to the US for a more reliable and diversified energy supply.

Key Highlights: India’s US Crude Oil Imports Jump 50% in H1 2025

• India has recorded a remarkable rise in its crude oil imports from the United States during the first half of 2025. The volume has increased by over 50% compared to the same period in 2024, signaling a major shift in India’s energy procurement strategy.
• Between January and June 2025, India recorded a daily average import of around 0.271 million barrels of crude oil from the United States. In contrast, the same period in 2024 recorded around 0.18 mb/d, reflecting a clear 50% increase. Between April and June 2025, imports jumped by 114% year-on-year.
• In terms of monetary value, the import bill increased from $1.73 billion in Q1 FY24-25 to around $3.7 billion in Q1 FY25-26, showing both higher volumes.
• In July 2025, India raised its crude oil imports from the US by 23% compared to the previous month, which increased the US share in India’s overall crude intake from 3% to 8% in just one month.
• The growing partnership isn’t restricted to crude oil. Imports of liquefied natural gas (LNG) from the US nearly doubled, reaching $2.46 billion in FY2024-25, up from $1.41 billion in FY2023-24. 
• Additionally, liquefied petroleum gas (LPG) imports also showed a significant rise, although exact figures remain undisclosed.
• Talks are underway between both countries for a multi-billion-dollar long-term LNG supply agreement, pointing to deepening trust in long-term energy cooperation. 

Why India’s US Crude Oil Imports Surge?

• Need for Diversified Energy Sources: India has been actively working to reduce its dependency on any single crude oil supplier. India has traditionally sourced a significant portion of its crude oil from West Asian countries, mainly Iraq and Saudi Arabia. However, geopolitical instability in these regions has caused repeated disruptions in the energy supply chain. The United States has emerged as a preferred supplier due to its abundant oil output and reliable export systems.

• Competitive Pricing: Over the past year, American suppliers have offered light sweet crude at prices that often compete well with Middle Eastern grades. This type of crude is easier to refine and produces higher yields of clean fuels like petrol and diesel. This sharp growth in volume and value highlights how Indian refiners are responding to favorable pricing trends.

• Strategic Energy Partnership: The rise in oil imports also reflects the broader strategic energy relationship between India and the US. Over the last few years, both countries have deepened their ties in trade, defence, and energy cooperation. Indian companies have entered into long-term agreements with US oil exporters, promoting consistent and predictable shipments.

• Infrastructure Readiness: Over the last decade, Indian ports and refineries have been modernized to handle different types of crude from various global sources, including US shale oil. The Indian government has consistently pushed for energy security through diversification, as highlighted in national policy frameworks. 

India’s Crude Oil Imports Dynamics

• Import Dependence: India continues to meet over 85% of its crude oil needs through imports. In the financial year 2023–24, India’s total crude oil imports reached about 232.5 million metric tonnes, showing a marginal rise from the previous year. As per Ministry of Petroleum and Natural Gas data, this dependency has remained constant over the past few years. 

• Top Suppliers: In 2025, most of India’s crude oil still comes from the Middle East. Countries like Iraq, Saudi Arabia, and the UAE remain top suppliers. Iraq was India’s largest crude supplier in early 2025, contributing about 22% of total imports. India has also significantly increased its crude oil imports from the United States.

• Import Costs: The cost of crude oil imports is a concern for India’s economy. India spent around $137 billion on oil imports, as per trade data. This was higher than the previous fiscal year due to both higher prices and increased volumes. 

• Infrastructure: India has expanded its refining and port infrastructure to handle crude from different regions. Refineries located in Jamnagar, Paradip, and Vizag are equipped to handle multiple grades of crude, including the light sweet variety from the US. The government is also focusing on building strategic petroleum reserves and improving pipeline connectivity to reduce inland transport costs.

Government’s Initiatives to Control Surging Oil Demands

• The government is increasing ethanol blending in petrol to reduce oil consumption. In 2022, the blending target of 10% was achieved ahead of schedule. 
• By 2025, India successfully reached the ethanol blending target of 20%, according to official data from the Ministry of Petroleum and Natural Gas.
• India is encouraging more domestic oil and gas exploration. Under the Hydrocarbon Exploration and Licensing Policy (HELP) launched in 2016, over 100 new blocks were awarded by 2023. The goal is to raise local production and reduce reliance on imports.
• The government is promoting energy-saving habits through campaigns. The Bureau of Energy Efficiency (BEE) runs the “Saksham” initiative, which creates awareness about fuel conservation. Launched in partnership with oil companies, this program educates drivers and industries on how to reduce fuel usage. 
• India is pushing electric vehicles to cut fuel demand. The FAME II scheme, launched in 2019, provides subsidies for EVs. Electric buses, two-wheelers, and charging stations are being introduced under this policy. EVs help reduce long-term dependency on oil.
• India is increasing the share of renewables to reduce oil use in power and transport. As of March 2025, India’s renewable energy capacity exceeded 180 GW, covering sources like solar, wind, and hydropower. The government aims to reach 500 GW by 2030, as stated in official energy roadmaps.