India`s oil trade deficit likely to widen sharply in FY27 amid rising imports: Crisil
Crisil in its latest report has said that rising crude prices, weakening petroleum exports and heavy dependence on imported oil are likely to push India’s oil trade deficit higher in FY27, straining external balances. The report further stated that India continues to rely heavily on overseas crude supplies, with more than 85 per cent of its annual crude oil requirement met through imports.
The report showed a steady rise in India’s oil imports from nearly 190 million tonnes in FY14 to over 300 million tonnes in FY26. In contrast, exports remained comparatively range-bound over the same period. It said the oil trade deficit, which had moderated during periods of lower crude prices in the past, has again started widening.
Besides, it said that the increase in import volumes has not been matched by growth in refined petroleum product exports, which have largely remained flat over the years except for a temporary spike following the Covid-19 pandemic. The report noted that pressure on the oil trade deficit intensified from FY24 onward as exports of refined petroleum products declined for two straight fiscals, even while imports continued to rise.
