India’s average crude import price soared to above $100 per barrel at the end of last week and is set to further rise this week as international crude prices rallied amid intensified hostilities in the Middle East.
The so-called Crude Oil FOB Price, or the Indian Basket of average sweet and sour grades, surged to $101.07 per barrel on Friday, topping the $ 100-a-barrel threshold for the first time since May, data by the Indian Oil Ministry’s Petroleum Planning and Analysis Cell (PPAC) showed.
The Indian basket of crude oil is the average of a derived basket comprising a sweet-grade benchmark, Dated Brent, and the sour-grade benchmark of the Oman and Dubai average imported by Indian refineries during each month.
As of Monday, the average Indian Basket of crude oil so far in September was $99.38 per barrel, up from $83 in June, $82 in July, and $90 in August.
The average hit $100 in early September, as international crude oil prices rallied amid the re-escalation in the Middle East, as the United States and Iran continue to exchange strikes and fire for more than a week now.
India’s crude oil import bill has soared in recent months, due to the reduced oil flows from the Middle East and the high risks to shipping in the Strait of Hormuz.
The freight rates on the key route from Ras Tanura on Saudi Arabia’s Persian Gulf to India have soared by more than 400% since February 28, when the war began and Iran closed off the Strait of Hormuz.
India paid 60% more for crude oil imports in the April-June quarter compared to the same period last year, as the surge in oil prices offset slightly lower import volumes.
The rise continued into the beginning of the third quarter, with the July import bill 41% higher than a year earlier.
By Tsvetana Paraskova for Oilprice.com
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