How Much India Pays to Buy Crude Oil from Different Countries
India is one of the world’s largest consumers of crude oil. However, the country produces only a small portion of the oil it needs domestically. As a result, India imports nearly 85–90% of its crude oil requirements from other countries. The price India pays for crude oil varies depending on global market conditions, the type and quality of crude oil, transportation costs, and geopolitical factors.
In recent years, India has diversified its oil suppliers to ensure energy security and obtain oil at competitive prices.
Major Countries Supplying Crude Oil to India
India imports crude oil mainly from Russia, Iraq, Saudi Arabia, the United Arab Emirates, the United States, and several other countries. The price per barrel differs slightly depending on the quality of oil and contractual agreements.
| Country | Approximate Price per Barrel (USD) | Remarks |
|---|---|---|
| Russia | $70 – $80 | Discounted oil after international sanctions |
| Iraq | $75 – $85 | One of India’s long-time major suppliers |
| Saudi Arabia | $80 – $90 | Price generally linked to global benchmarks |
| UAE | $80 – $88 | Medium-sour crude suitable for Indian refineries |
| United States | $85 – $92 | Higher cost due to transport and premium crude |
| Canada | $75 – $80 | Heavy crude sometimes sold at lower prices |
| Brazil / Guyana | $88 – $93 | Light sweet crude, usually more expensive |
| Norway | Around $90 | Benchmark-quality crude |
India’s Largest Crude Oil Suppliers
In the last few years, the pattern of oil imports has changed significantly. Russia has emerged as the largest supplier because it offered discounted oil in global markets.
| Country | Share in India’s Oil Imports |
|---|---|
| Russia | About 36–37% |
| Iraq | About 18–20% |
| Saudi Arabia | About 13–14% |
| UAE | About 10–11% |
| United States | About 5–6% |
India’s Total Oil Import Bill
India imports roughly 4.8 to 5 million barrels of crude oil per day. With the average international crude price ranging between $80 and $85 per barrel, the country spends approximately $140 to $150 billion every year on crude oil imports.
Why Oil Prices Differ Between Countries
Several factors influence the price India pays for crude oil, including:
Quality of crude oil (light or heavy crude)
Distance and transportation costsGlobal market benchmarks such as Brent crude
Discounts offered by exporting countries
Geopolitical factors and sanctions
Conclusion
India’s growing economy requires a large and stable supply of energy. To meet this demand, the country imports crude oil from multiple regions including the Middle East, Russia, North America, and South America. By diversifying suppliers and purchasing oil at competitive prices, India attempts to manage its energy needs while reducing vulnerability to global market fluctuations.
How Much Discount Russia Gives to India on Crude Oil
After the start of the Russia–Ukraine War, Russia began offering significant discounts on its crude oil to attract buyers, especially Asian countries such as India and China. Because many Western countries reduced or stopped purchasing Russian oil, Russia started selling oil at lower prices to maintain exports.
Average Discount on Russian Oil
Russia mainly sells Urals crude to India at a discount compared with the global Brent crude oil price.
| Period | Discount per Barrel | Example Price |
|---|---|---|
| Early 2022 (start of war) | $25 – $35 cheaper than Brent | Brent $110 → Russia $75–85 |
| 2023 | $15 – $25 cheaper | Brent $95 → Russia $70–80 |
| 2024–2026 | $5 – $15 cheaper | Brent $85 → Russia $70–80 |
Example Price Comparison
| Oil Type | Approx Price per Barrel |
|---|---|
| Brent benchmark oil | $85 – $90 |
| Russian Urals crude sold to India | $70 – $80 |
| Average discount | $10 – $20 per barrel |
Why Russia Gives Discount
Russia offers discounted oil for several strategic reasons:
Sanctions from Western countries reduced its traditional buyers.
Russia needed to maintain oil exports to keep its economy stable.
Long-distance shipping and insurance costs increased.
Asian markets such as India became the biggest alternative buyers.
Impact on India
Because of these discounts:
Russia became India’s largest crude oil supplier.
Indian refineries were able to reduce import costs.India saved billions of dollars in energy imports.
✅ In simple terms:
Russia usually sells crude oil to India $10–$20 cheaper per barrel than global benchmark prices, though the discount was even higher in the early months after the Ukraine war
How Much India Paid Iran for Crude Oil Before Sanctions
Before 2019, Iran was one of the major suppliers of crude oil to India. Indian refineries preferred Iranian oil because it was relatively cheaper and came with several financial advantages such as flexible payment terms and shipping benefits.
However, after the United States withdrawal from the Iran nuclear deal and the re-imposition of sanctions on Iran, India stopped importing Iranian crude in 2019 to avoid financial penalties from the United States.
Average Price India Paid for Iranian Oil
The price India paid for Iranian crude oil depended on international oil prices, but Iran usually offered a small discount compared with other Middle Eastern suppliers.
| Period | Global Oil Price | Price India Paid to Iran | Approx Discount |
|---|---|---|---|
| 2010–2014 | $95 – $110 per barrel | $90 – $105 | $3 – $5 cheaper |
| 2015–2018 | $50 – $75 per barrel | $45 – $70 | $3 – $5 cheaper |
| 2018–2019 | $70 – $80 per barrel | $65 – $75 | $3 – $5 cheaper |
In most cases, Iranian oil was about $3–$5 per barrel cheaper than other Middle Eastern crude oils.
Additional Benefits India Received from Iran
Apart from the price discount, Iran offered several benefits that made its oil more economical for Indian buyers:
Free or discounted shipping through Iranian oil tankers
Long credit period of 60 to 90 days for paymentsPartial payments allowed in Indian rupees instead of US dollars
Flexible payment mechanisms during earlier sanction periods
These advantages significantly reduced the overall cost for Indian oil companies.
India’s Oil Imports from Iran
Before sanctions were tightened, Iran was among the top suppliers of oil to India.
| Year | Approximate Imports |
|---|---|
| 2016–2017 | Around 27 million tonnes |
| 2018–2019 | Around 480,000 barrels per day |
Why India Stopped Buying Iranian Oil
India stopped importing oil from Iran in 2019 mainly due to international sanctions. These sanctions restricted global banking, shipping insurance, and financial transactions related to Iranian oil exports.
Conclusion
Before sanctions, Iranian crude oil was one of the most economical options for India. With a $3–$5 per barrel discount, along with shipping and payment advantages, Iran played an important role in India’s energy imports. However, geopolitical developments and international sanctions forced India to stop purchasing oil from Iran despite its economic benefits.