Share of Canada, US in Indian oil import rises to record high in January

The share of Canada and the United States of America in India's January oil imports surged to a record 11% while that of the Middle East and South America declined, data obtained from sources showed. Asia's third-largest economy imported about 4.8 million barrels per day (bpd) oil in January, a decline of 6% from the previous month and marginally higher than a year earlier.

India's imports from Canada and the United States almost doubled from December to 142,000 bpd and 367,000 bpd, respectively. The United States emerged as the fourth-biggest supplier to India after the United Arab Emirates. "Demand for gasoline in India recovered at a faster pace than other products and North American grades are gasoline-rich," said Ehsan Ul-Haq, lead analyst for Oil Research and Forecasts at Refinitiv, adding that most Middle Eastern grades were distillate-rich.

"Crude from America was cheap compared to other producing regions in November while Canadian oil is sold at a deeper discount to Brent." India, the world's third-biggest oil importer and consumer, ships in more than 80% of its crude needs and relies heavily on the Middle East.

However, its reliance on the Middle East is declining as refiners are diversifying crude sources to hedge against disruption and buy cheaper barrels from elsewhere to boost margins. The share of Middle Eastern oil in India's oil imports last month plunged to an eight-month low of about 61% on low supplies from Iraq and Saudi Arabia, while that of Latin America declined to a six-month low of about 6.4%.

Iraq has cut annual oil supply deals for Indian refiners for 2021. Saudi supplies during the month declined by 20% from December. Despite lower imports, Iraq continued to be the top oil seller to India last month followed by Saudi Arabia. Low supplies from the Middle East and South America dragged the share of OPEC nations in India's overall oil imports to a record low in April-January.

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