Why the world is turning to India’s refining strength

When US Secretary of State Marco Rubio visited Reliance Industries’ Jamnagar refinery in Gujarat this week, he sent a clear message about India’s growing importance in global energy trade. Calling India a “refining superpower”, Rubio said Washington wanted Reliance to process more Venezuelan crude. The interest reflects a wider shift in global oil markets, where the ability to turn crude into usable fuel is becoming as important as access to oil itself.

India imports nearly 90% of the crude oil it consumes. Yet, it has emerged as a major supplier of finished fuels to international markets. Its advantage lies in its ability to process crude from different sources, including heavy and high-sulphur grades, and export large volumes of petrol, diesel and aviation fuel.

India has a refining capacity of 267.11 million metric tonnes per annum (MMTPA), making it the world’s fourth-largest refining nation, according to the Petroleum Planning and Analysis Cell. It produced 284.9 million tonnes of petroleum products in FY 2025-26 and exported 61.5 million tonnes, according to government data.

These figures underline why India matters beyond its domestic market. Its refineries can convert imported crude into products needed by buyers across Europe, Asia and Africa. This gives the country a role in global energy security even though it remains heavily dependent on overseas oil supplies.

Reliance’s Jamnagar complex illustrates this advantage. The world’s largest single-site refining complex, it has two refineries with a combined capacity of around 1.4 million barrels per day. The facilities can process a wide range of crude grades, including heavy and high-sulphur oil. According to Reliance, the complex has processed more than 216 different grades of crude.

This flexibility matters because crude oil varies in quality. Heavy grades generally require more complex processing to produce valuable fuels. Refineries equipped to handle them can consider a wider range of suppliers and buy oil based on price, availability and processing costs. Venezuela is a case in point. The country holds some of the world’s largest proven oil reserves, much of which is heavy crude. Jamnagar’s ability to process such oil makes it a potential destination for additional Venezuelan supplies. India has already increased its purchases. According to the Global Trade Research Initiative (GTRI), the country imported Venezuelan crude worth about $3.6 billion between April and August 2026. Reliance accounted for 74.3% of these imports, helping explain Washington’s focus on the company.

But buying more Venezuelan crude will make commercial sense only if the price is right. Heavy oil can involve higher processing costs, while the long journey from South America adds to freight expenses. The discount must be sufficient to cover these costs and leave refiners with a reasonable return.

India’s importance extends beyond Venezuelan crude. Its refineries can supply overseas buyers when other regions face shortages or lose access to established suppliers. Europe, in particular, is under pressure as high energy and labour costs, carbon-emission rules and weaker demand make it harder for older refineries to compete.

An S&P Global report estimates that Europe may need to close 500,000-700,000 barrels per day of refining capacity by 2030. New refineries in Asia and the Middle East are adding to the pressure. India’s export capacity gives international buyers another source of finished fuels, although individual shipments depend on market conditions and applicable trade rules.

India’s exports underline this role. Market intelligence data show that the country exported an average of 151,000 barrels per day of middle distillates, mainly diesel, in 2025, with much of the supply going to Europe and the Mediterranean. Shipments of jet fuel and kerosene to these markets rose to 83,000 barrels per day in September 2026. Ship-tracking data cited by Reuters also showed that India exported nearly 47 million tonnes of petrol, diesel and jet fuel in 2025.

The US, too, has seen refining capacity decline. The US Energy Information Administration put its capacity at around 18.2 million barrels per calendar day on January 1, 2026, down by more than 250,000 barrels per day from a year earlier. India cannot replace the much larger US refining system, but it can add to supplies available in international markets.

There are limits to this advantage. India must first meet its own demand, which reached 243.2 million tonnes of petroleum products in FY 2025-26. It must also manage the costs and risks of importing crude. Russia remains a major supplier, although GTRI data show that Indian purchases fell from $7.3 billion in July 2026 to $5.4 billion in August. Russia’s share of India’s crude imports declined from 51% to 45% over the same period.

Switching suppliers is not simply a matter of finding cheaper oil. Crude quality, shipping costs, refinery requirements and sanctions all affect the final economics. A wider choice of suppliers gives India flexibility, but does not remove its exposure to global price shocks.

India’s refining strength is therefore both an economic asset and a source of strategic influence. It allows the country to buy crude from different regions, convert it into valuable products and sell those products where demand is strong. The opportunity is to earn foreign exchange and strengthen its position in global energy trade.

India cannot eliminate the risks of importing most of its crude or fill every gap left by refinery closures elsewhere. But when global oil routes are disrupted, the ability to process different grades of crude and deliver finished fuels becomes as important as access to oil itself. That is the strength Washington is looking to tap.