After exports aboard non-sanctioned tankers run by Russia’s largest shipping business, Sovcomflot, resumed in April, India’s purchases of Russian oil reached a nine-month high. Russia now accounts for a larger portion of India’s oil imports, with the country importing close to 1.8 million barrels per day (BPD), an 8.2% rise over the previous month. The data comes from shipping and trade sources. This rise followed a brief suspension of purchases from Sovcomflot by Indian refiners. This stop came after the company’s ships, including 14 tankers, were flagged by the US as violating Western sanctions.
The West enacted sanctions in reaction to Russia’s military invasion on Ukraine in 2022, with the goal of lowering Moscow’s oil profits, which are used to finance its military operations. The restrictions included price caps on oil and comparable products. India is Russia’s biggest customer, ranking third in the world both as an oil importer and consumer. India has long valued this partnership over those with Middle Eastern suppliers because of Russia’s competitive crude price.
India purchased 4.8 million BPD of oil in the first few days of April. While down 6.5% from March, this amount is still slightly greater than imports in April 2023. The rise in oil imports from Russia has significantly impacted India’s oil basket, even though the percentage has decreased.
India’s dependency on Middle Eastern oil has decreased as a result of the rise in Russian oil imports. The Organization of the Petroleum Exporting Countries (OPEC) now holds a 46% rather than a 53% part in India’s crude basket as a result of this change. India’s shift toward Russian oil has had an impact on its purchases of goods from other CIS nations, such as Kazakhstan and Azerbaijan. From 37% in March to 41% in April, these CIS nations accounted for a larger portion of India’s overall oil imports.
India’s strategic adjustment in its oil import patterns throws light on the global oil market patterns complexities, especially in light of the country’s geopolitical unrest and economic sanctions. Although India still trades with traditional Middle Eastern suppliers, its import plans have changed due to the allure of cheap Russian crude. India’s strategic modifications to its energy procurement strategies are seen in the rising oil imports from Russia, which are propelled by favorable economic conditions and geopolitical change.
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