Indian refineries have been actively purchasing Russian oil for the past two months and plan to continue purchases at current high levels until the end of the year as the country faces a supply shortage from the Middle East.
Points of attention
- Indian refineries have been actively purchasing Russian oil to counter supply shortages from the Middle East.
- India, the world's third-largest oil importer, is taking advantage of low prices and exemptions to continue buying Russian oil.
India has returned to purchasing Russian oil
India, the world's third-largest oil importer, has been actively purchasing Russian oil since 2022, taking advantage of low prices, while other countries have refused these supplies due to sanctions imposed on Russia.
The situation changed last year when US President Donald Trump began pressuring India to stop these imports, imposing punitive tariffs and ultimately imposing sanctions on the two largest producers in Moscow.
However, following US and Israeli attacks on Iran and the subsequent closure of the Strait of Hormuz, Washington, seeking to contain oil prices, granted a sanctions waiver in early March to allow the purchase of Russian oil. It was later expanded and extended.
After the first permit, India purchased about 60 million barrels for delivery this month.
Executives of leading Indian refineries, speaking on condition of anonymity, said they expect the US sanctions waiver, which allows them to buy Russian oil, to be extended before it expires in the coming days.
At the same time, even without this, procurement volumes are unlikely to decrease, given the lack of alternative sources of supply, they added.
According to analytical company Kpler, in March, imports from Russia averaged 1.98 million barrels per day — the highest figure since June 2023.
In April, this figure fell to 1.57 million barrels per day, but this is due to the fact that the 400,000-barrel-per-day Nayara Energy refinery, which mainly runs on Russian oil, stopped for maintenance.
According to executives, procurement volumes are expected to increase again starting next month.
India is also trying to secure its supply of liquefied natural gas, which Russia is offering to Asian buyers despite sanctions. Last week, these supplies were offered at a 40% discount to spot prices.
