Strong Indian Purchases Push Asia’s Crude Imports To One-Year High

Authored by Tsvetana Paraskova via OilPrice.com,

Record-high crude imports in India have pushed Asia’s oil arrivals in May to the highest level in a year, per data compiled by LSEG Oil Research and cited by Reuters columnist Clyde Russell.

Asia, the key crude oil importing region and a gauge of oil demand trends, is set to welcome in May 27.81 million barrels per day (bpd) of crude oil volumes, nearly 1 million bpd higher than the April imports, per the LSEG Oil Research data.   

Most of the 920,000-bpd growth in Asia’s estimated crude oil imports this month has been thanks to a 710,000-bpd surge in volumes shipped to India, which is back to importing increased volumes of cheaper Russian crude oil.

India is estimated to see its crude imports jump to a record-high of 5.26 million bpd in May, up by 710,000 bpd from 4.55 million bpd of crude imported in April, according to the data compiled by LSEG Oil Research.

While India is leading Asia’s crude imports higher, China is again showing signs of weaker import demand. The world’s top crude oil importer is expected to haul in 10.72 million bpd of crude in May, down from the 10.93 million bpd imports in April and the lowest per-day volumes since January, Reuters’ Russell notes.

The stronger Indian economy compared to China and the renewed appetite from Indian refiners for Russian crude – after hesitation earlier this year when stricter U.S. sanctions on Russia’s oil trade were enforced – have been pushing Indian fuel demand and crude imports higher in recent weeks.

For example, India is estimated to have boosted its imports of Russian crude to a nine-month high in April, per data Reuters has obtained from industry and shipping sources.

Moreover, India’s crude oil demand has been growing this year despite consistently higher prices, suggesting that it is more resilient to price rises than some expected.