India used the ultra-low crude oil prices to top its strategic petroleum reserves with oil at $19 a barrel, saving nearly US$700 million in the process. Taking advantage of the low crude oil prices in international market, India purchased 16.71 million barrels (mbbl) of crude in April – May, 2020 and filled all the three Strategic Petroleum Reserves created at Vishakhapatnam, Mangalore and Padur. The average cost at which India bought the crude oil in April and May was $19 per barrel, compared to $60 a barrel oil price in January 2020. Thanks to the cheapest oil in years at the start of the second quarter, India saved US$685.11 million on its crude oil import bill.
India, which is expected to be the key energy growth driver in the world and a main source of oil demand growth in the coming decades, is now looking to expand its petroleum reserves capacity as it looks to boost its energy security and forge closer commercial ties with major energy companies. Last month, India allowed Abu Dhabi National Oil Company (ADNOC) to export oil from an Indian storage site, part of which the UAE firm had leased for its oil. This was a shift from India’s policies that do not allow oil sales to non-Indian refiners. India’s primary energy consumption is set to more than double by 2050 under all three scenarios BP has projected in its latest Energy Outlook 2020.