The US has grown to be the biggest gainer of its decision to impose sanctions on oil-producing countries Iran and Venezuela.
America has steadily improved its exports post-sanctions and has now become the second-biggest oil supplier to India, the world’s third-largest oil consumer.
As per trade data, the US supplied almost 2.2 million tons (mt) of oil to India in February, greater than even Saudi Arabia, which had traditionally been among the biggest exporters of oil to India. That is a 48 percent growth in US oil exports to India and is accounting for nearly 14 percent of India’s total oil imports in February.
Surprisingly, the Saudis supplied about 1.8 mt of oil to India in February, a fall of over 40 percent, which pushed it to the number 4 position among countries meeting the energy demand of the world’s third-largest oil importer.
Sources said US sanctions have lifted oil trade with the US as it’s rapidly occupying the house vacated by Iran that has been among India’s top three oil suppliers in the past.
Before sanctions reduced Iranian oil supplies to almost zero levels in FY21, the Islamic nation used to export over 20 mt of oil to India, accounting for over 10 percent of the nation’s total oil imports.
This yr (FY21) up to February, imports from the US have already elevated to their highest ever stage of about 13 mt and May end the yr with 15 mt of oil imports. India imports over 200 mt of oil per yr and meets 85 percent of domestic oil wants through shipping channels.
In 2020-21 April-December, the US was the fourth-largest supplier ($4.9 billion) after Iraq ($9.4 billion), Saudi Arabia ($8.9 billion), and UAE ($7.4 billion)
India began imports of oil from the US in 2017.
For the US, the trade dispute with China has meant exploring a nearer marketplace for its surplus oil which this yr has grown to be very distinct with decrease demand within the home market. India has offered the right market in this environment to push oil sales.
“Indian refineries are preferring to go for cheaper US crude purchases as it helps them offset provide cuts announced by OPEC + and unilateral 1 million barrel per day production cuts by Saudi Arabia. India has been pushing OPEC to extend production and assist tame rising crude costs that go against the interest of prime oil.
