Indian refineries continue to intensively purchase Russian oil, maintaining import volumes at a record high level over the past two months. This trend is expected to continue until the end of the year as the country faces limited raw material supplies from the Middle East.
This is reported by Finway
Impact of Sanctions and Political Decisions on India’s Oil Market
India remains the third-largest oil importer in the world. Since 2022, the country has been benefiting from low prices for Russian oil, while many other nations have reduced purchases due to sanctions pressure on Russia. Last year, U.S. President Donald Trump intensified pressure on New Delhi, urging Indian authorities to cease purchases and also imposed punitive tariffs and sanctions against two of Moscow’s largest oil companies.
The situation changed after the March attacks by the U.S. and Israel on Iran and the closure of the Strait of Hormuz, which led to rising oil prices. To stabilize the market, Washington temporarily lifted sanctions on the purchase of Russian oil. This exemption was later extended, allowing India to increase its purchases.
“Executives from leading Indian refineries, speaking on condition of anonymity, stated that they expect the continuation of the American exemption from sanctions allowing the purchase of Russian oil before its expiration in the coming days. At the same time, even without this, purchase volumes are unlikely to decrease given the lack of alternative supply sources,” they added.
Oil and Gas Imports: Statistics and Prospects
According to analytics from Kpler, in March, the average daily import of oil from Russia reached 1.98 million barrels, the highest level since June 2023. In April, this volume decreased to 1.57 million barrels per day due to maintenance shutdowns at the Nayara Energy refinery, which specializes in processing Russian oil. Meanwhile, industry leaders predict that purchases will resume growth as early as next month.
In addition to oil, India aims to expand its imports of liquefied natural gas from Russia, which is offered to Asian consumers at significant discounts. Recently, the price for such supplies was 40% lower than spot quotes.
It is worth noting that to curb rising energy resource costs, the U.S. administration temporarily suspended sanctions on Iranian oil, allowing its supply to the international market for one month.