India Turns to Russian Oil Amid Global Supply Shifts

In July 2024, India maintained a strong reliance on Russian crude oil, importing 20.8 lakh barrels per day (bpd), the highest total since June the previous year. This accounted for approximately 43% of India's total oil imports, significantly outpacing contributions from other suppliers.

The increase was largely driven by the import of Urals crude, which remains the primary grade sourced from Russia, alongside a notable uptick in ESPO crude imports.

Despite this strong performance, there were indications of a slight decline in Russian oil imports compared to previous months, attributed to increased domestic demand in Russia as refineries ramped up operations for the summer. Analysts expect Russian crude supplies to India to decrease in the coming months, particularly as Indian refiners enter maintenance periods, which could further impact import volumes.

The competitive pricing of Russian oil continues to be a crucial factor for Indian refiners. The price advantage of Urals crude over other grades, particularly from Saudi Arabia, has made it an attractive option despite narrowing discounts. In July, the price differential was around $5 per barrel lower than Saudi grades, prompting Indian refiners to favour Russian imports.

The dynamics of India's oil imports reflect a growing dependency on Russian crude, with Russia solidifying its position as the top supplier amidst fluctuating contributions from traditional suppliers like Saudi Arabia and Iraq.

Source: The Indian Express