US crude oil exports to India hit a record in June and so far this year are almost double last year’s total as the country’s refiners move to replace supplies from Iran and Venezuela in a win for the Trump administration.
The USA has become a major crude exporter of oil, sending 1.76 million barrels per day (bpd) abroad in April, according to the latest government figures. The exports to India could go higher if China imposes levies on its U.S. oil imports over the latest round of US tariffs, which could damp Chinese purchases and lead U.S. crude prices lower.
AK Sharma, head of finance at Indian Oil Corp, India’s top refiner, said US crude is gaining appeal because of its lower cost, and could expand further if China cuts its imports of US energy.
“If China levies a tariff on US oil then US imports to India will probably rise,” he said. “We are looking for a mini-term deal to buy three to four cargoes of US oil over a period of three to six months instead of buying single cargoes.”
Last month, India’s imports of Iranian crude fell by 16 percent from May, paring sharp year-over-year increases during the first half of this year. The Trump administration plans to send a delegation in the coming months to India to discuss Iran sanctions and oil issues.
“Our focus is to work with those countries importing Iranian crude to get as many of them as possible down to zero by Nov. 4,” a US State Department official said.
Reuters’ vessel tracking data show three of the eight tankers charted by Swiss and Chinese traders and sent to India in recent weeks were destined for a port near Reliance Industries Ltd’s Jamnagar refinery, the world’s largest. Three others are headed for undisclosed ports on India’s west coast from the US Gulf Coast.