NEW DELHI: After registering a dip in March and April due to disruptions in supply flows amid the West Asia conflict, crude oil and LPG supplies to India improved in May, though they were yet to return to pre-conflict levels, ship-tracking data from Kpler has revealed.
While India's crude imports fell from 5.2 million barrels a day (mbd) in February to 4.5 mbd in March-April, they recovered slightly to around 4.9 mbd in May. LPG supplies also improved after the government diversified sourcing. Natural gas supplies, however, recovered significantly and surpassed the volumes received in February.
UAE emerges as India's second-largest oil supplier in May
Data showed that Russia continued to be India's largest crude supplier, being an important source of supply security during a period of heightened market uncertainty, while West Asian flows became more uneven, particularly from Iraq and Kuwait. The UAE emerged as the second-largest oil supplier to India in May, followed by Saudi Arabia, Brazil and Venezuela.
"One of the most notable developments over the past three months has been the resilience of Russian crude flows to India. Russian barrels have continued to offer Indian refiners a combination of pricing advantages, stable availability and logistical flexibility at a time when many traditional suppliers have faced export constraints," said Sumit Ritolia, lead analyst at Kpler. Regular sourcing of crude from Russia helped India reduce immediate exposure to disruptions in the Strait of Hormuz and limited the need for more aggressive sourcing from higher-cost Atlantic Basin suppliers.
LPG and natural gas supply dynamics
LPG supplies from West Asia continued to remain disrupted due to the closure of Hormuz. Imports fell sharply from more than two million tonnes a month in January-February to around 1-1.2 million tonnes in March-May amid lower availability from the Gulf region. Higher inflows from the US, ramped-up domestic production and demand management helped India plug the supply gap and meet cooking gas demand.
Continuous supplies of LNG, despite a temporary dip, along with domestic availability, helped India maintain adequate LNG stocks. Kpler said Qatar's share in India's LNG imports had dropped sharply in recent months, while the US, Oman, Nigeria and Angola emerged as increasingly important sources of supply.
"Overall, India has managed the disruption through a combination of diversified sourcing, higher Atlantic Basin arrivals, inventory use and demand-side adjustment," Ritolia said, adding India may need to continue relying more heavily on Russian, US, African and Latin American barrels if the disruption persists.
