India Rides Out Global Diesel Crisis Amid Rising Dependence on Russian Crude

The global diesel crisis is deepening due to supply disruptions from various angles, including the Russia-Ukraine war and the Iran crisis. Despite this, India has managed to remain largely unaffected, continuing to export diesel and avoid domestic scarcity.

Data from the Paris-based International Energy Agency shows that diesel exports from key regions have fallen by 1.3 million barrels per day year-on-year, equivalent to about 20% of global seaborne trade. Meanwhile, jet fuel exports from these regions have declined by around 670 thousand barrels per day, equal to 34% of global trade.

India's role in the crisis is significant, as it has been stepping up fuel exports in recent years. The country exported an estimated 4.2 million to 5 million barrels to Europe in July alone. India does not import diesel as a finished product but instead buys massive quantities of crude oil and processes it domestically.

India's dependence on Russian crude is also notable, with imports rising to a record high of 2.78 million barrels per day in July. The discounted prices offered by Moscow have helped contain oil import costs for India amid the West Asia crisis.