Crude oil is a naturally occurring liquid fossil fuel that lies beneath the Earth's surface. It undergoes refining to produce essential fuels such as petrol, diesel, and kerosene. This resource is vital for various sectors, including transportation, industrial operations, and electricity generation.
India faces a significant challenge in meeting its crude oil requirements due to limited domestic production, which covers only 13% of its total demand. Consequently, the country relies heavily on imports for the remaining 87% of its crude oil needs.
India sources crude oil from several countries to ensure a stable supply. The primary suppliers include:
India is increasing its imports from the U.S. to diversify its sources and reduce dependency on any single country. This strategy not only enhances energy security but also allows India to secure oil at competitive prices. The U.S. also plays a role in supplying liquefied natural gas (LNG) and refined petroleum products.
LNG, or Liquefied Natural Gas, is natural gas cooled to a liquid state for efficient storage and transport. It is a cleaner alternative to crude oil and is widely used for electricity generation, industrial activities, and transportation.
In the year 2023-24, India imported approximately 246 million tonnes of crude oil. For LNG, the country imported around 31.80 billion cubic meters (bcm), amounting to a cost of $10.345 billion.
Following the imposition of Western sanctions on Russia due to the Ukraine war, India has increased its oil imports from Russia, which now accounts for 40% of its total crude imports in 2023-24, a significant rise from just 1% in 2021.
India boasts a robust oil refining industry, which processes crude oil into various fuels, including petrol and diesel. Additionally, some refined products are exported to other nations, contributing to the economy.
India is working towards achieving energy security while also promoting clean energy initiatives. Key strategies include:
India's crude oil import strategy faces several challenges, including:
Looking ahead, India is focusing on:
Energy security fundamentally involves ensuring access to affordable, reliable, and sustainable energy sources.
Q1. What is crude oil and why is it important?
Answer: Crude oil is a vital fossil fuel refined into various petroleum products essential for transportation and electricity generation.
Q2. Why does India import crude oil?
Answer: India imports crude oil because domestic production meets only 13% of its needs, making imports critical for energy security.
Q3. How much crude oil does India import annually?
Answer: In 2023-24, India imported about 246 million tonnes of crude oil to fulfill its energy requirements.
Q4. What is LNG and how does it differ from crude oil?
Answer: LNG, or Liquefied Natural Gas, is a cleaner fuel compared to crude oil, used primarily for electricity and industrial applications.
Q5. What challenges does India face in crude oil imports?
Answer: India faces challenges like fluctuating prices, geopolitical tensions, and the need for cleaner energy alternatives in its oil import strategy.
Question 1: What percentage of crude oil does India import?
A) 13%
B) 87%
C) 40%
D) 60%
Correct Answer: B
Question 2: Which country supplied the most crude oil to India in 2023-24?
A) Iraq
B) Saudi Arabia
C) Russia
D) United States
Correct Answer: C
Question 3: What is the main use of LNG in India?
A) Transportation
B) Industrial use
C) Electricity generation
D) All of the above
Correct Answer: D
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