Crude oil production by India’s largest upstream players, ONGC and Vedanta , is showing a consistent decline, which is causing an overall fall in the country’s domestic crude oil output.
As per the data the Petroleum Ministry shared with the Parliament, ONGC’s crude oil production dropped by 7 percent to 19.643 million metric tonne (MMT) in FY23 from 19.643 MMT in FY19. While the decline in output was witnessed each year from FY19 till FY21, the production showed a marginal uptick from FY22 to FY23.
The decline in crude oil production is probably sharper in the case of India’s largest private sector exporter and producer Vedanta. The company’s crude oil output registered a year-on-year fall between FY19 and FY23, from 8,997 MMT to 5.922 MMT, a 34 percent decline.
Consequently, Vedanta’s share in India’s crude oil production too dropped from 26 percent in FY19 to 20 percent in FY23. Similarly, Oil India Ltd’s domestic crude oil production too slipped from 3.293 MMT in FY19 to 3.155 MMT in FY23.
Meanwhile, Shell has entirely stopped producing crude oil in India since the 2020-21 financial year.
As a result, India’s domestic crude oil production has fallen over 14 percent from 34.10 MMT in FY19 to 29.18 MMT last fiscal, with each year registering a decline.
Crude oil imports now constitute 88.5 percent of the total demand, with the share of domestic output sliding from 15 percent in FY19 to 12.5 percnt in FY23.
To meet India’s growing consumption of petroleum products, crude oil imports have grown over 18 percent in the last three years alone. And with crude oil prices having risen sharply during the same period, India’s oil import bill too has galloped . From $62 billion in FY21 it almost doubled to $120 billion in FY22, while last fiscal closed with a tab of $157 billion. In the Indian currency, it stands at over Rs 12.6 lakh crore.
