India's Economic Survey for 2026 has revealed a significant shift in the country's crude oil import patterns, particularly during the April-November period of the financial year. Imports from Russia have notably declined, while there has been a marked uptick from the United States, reflecting greater diversification in energy sourcing.

The survey points out that crude oil imports from several nations, including Libya, Egypt, Brazil, the US, and Brunei, have risen substantially compared to the same period in FY25. In contrast, shipments from Russia, Saudi Arabia, Iraq, and Venezuela have fallen.

This diversification underscores India's efforts to broaden its supplier base amid global geopolitical tensions and fluctuating energy markets. Although traditional suppliers still dominate, the growing shares from alternative countries signal a strategic pivot.

Specifically, the US share in India's crude oil imports jumped to 8.1 per cent in April-November FY26, up from 4.6 per cent the previous year. The UAE's portion also climbed to 11.1 per cent from 9.4 per cent.

Egypt's contribution has surged dramatically to 1.4 per cent from just 0.3 per cent. Nigeria's share increased to 3.3 per cent from 2.2 per cent, and Libya's rose to 0.5 per cent from 0.1 per cent.

These changes come against a backdrop of resilient merchandise trade performance for India. The survey emphasises that sustaining export growth will demand a shift towards higher-value products and new markets.

It also touches on the Indian rupee's valuation, describing it as undervalued—a factor that cushions against higher US tariffs on Indian goods. This undervaluation helps mitigate the effects without fuelling inflation from pricier crude imports.

In FY25, petroleum product exports dropped by 24.7 per cent year-on-year, driven by softer crude oil prices that declined 15.4 per cent. The current trends suggest India is adapting to lower oil costs while reducing reliance on any single supplier.

Russia's declining share is particularly noteworthy, given its role as a major discounted supplier since the Ukraine conflict. The uptick from the US aligns with strengthened bilateral energy ties and Washington's push to export more liquefied natural gas and crude.

Broader implications include enhanced energy security for India, the world's third-largest oil importer. Diversification reduces vulnerability to supply disruptions, such as those from Middle Eastern tensions or sanctions on Russia.

Economically, cheaper imports bolster India's trade balance and support refining margins. However, the survey warns that long-term export momentum requires innovation in sophisticated sectors beyond commodities.

The rupee's strength provides a timely buffer amid potential trade frictions with the US. Lower global oil prices further ease import bills, allowing fiscal space for infrastructure and defence spending.

As India navigates these dynamics, the survey's insights highlight prudent risk management in energy procurement. Future policies may further incentivise imports from stable, friendly nations to lock in these gains.

ANI