Price Trumps Politics in India's Oil Buying Decisions

India's state-owned Oil and Natural Gas Corporation (ONGC) has said that price is driving most of the country's oil buying, not politics. According to ONGC chairman and CEO Arun Kumar Singh, imports are decided by the price of spot crude cargoes, which have been influenced by cargo-to-cargo pricing. Singh stated, 'Imports are decided by the price, except for term crudes. Now term crudes are gradually going down. Spot crudes are mostly decided cargo-to-cargo based on price.'

Singh added that around 60% of India's oil imports are a function of the prevailing month or M+2 prices. Despite geopolitical upheaval, Singh emphasized that economics prevail over politics, stating, 'It is some geopolitical issue which is causing trouble, and ultimately world economy prevails.'

India remains highly dependent on crude oil imports, with around 90% of its consumption coming from abroad. The country has seen a steady rise in dependence on primary energy imports amid soaring demand and falling domestic production.