India's energy import bill soared 81.6% year-over-year to $18.7 billion in May, driven by higher oil and gas prices and a surge in import volumes. Crude oil imports rose 7.5% month-over-month, while LNG imports jumped 16% during the same period, according to provisional data from India's oil ministry compiled by local media.
On the supply side, the data reveals an acceleration in arrivals of non-Middle Eastern cargoes, as India diversifies its sources amid tight global markets. The country paid $10.3 billion for oil and gas imports in May 2025, up from $10.3 billion—though the latter figure appears to be the year-earlier comparison point.
The import surge comes as global oil markets remain volatile. Brent crude traded around $77 per barrel on Thursday, continuing a slide triggered by the U.S.-Iran agreement to reopen the Strait of Hormuz. Yet Argus Media's chief economist David Fyfe cautioned that oil price volatility would persist during the 60-day negotiation window, citing uncertain Middle East supply recovery and rapid global inventory drawdowns.
Geopolitical risks underscore India's vulnerability. As the world's third-largest oil consumer, the country's reliance on imports—now costing nearly $19 billion monthly—exposes it to supply disruptions and price swings. The recent U.S.-Iran deal may ease some pressure by restoring Hormuz traffic, but Fyfe noted the impact on prices won't be a one-way street.
Countering the bearish view, some analysts argue that an Iran deal could flood the market with additional supply, pushing Brent below $70 and providing relief for importers like India. However, with negotiations still fragile and inventory levels low, the near-term outlook remains uncertain.