Indian state-owned oil refineries, in collaboration with government officials, have developed a strategy to respond to the threat of oil supply disruptions caused by the escalation of the conflict surrounding Iran. As a result, oil flows through the Strait of Hormuz have significantly decreased, and India is once again considering active purchases of oil from Russia.
This is reported by Finway
Purchasing Russian Oil: A New Import Vector
India, which ranks third in the world in oil imports, is exploring various scenarios to ensure energy security. In particular, the purchase of Russian oil, which is already near Indian territorial waters, is being discussed. This was reported by sources familiar with the ongoing consultations.
Since the onset of the full-scale war in Ukraine, India has become the world’s largest maritime importer of Russian oil. However, recently the country has been forced to reduce these purchases under pressure from the United States, especially after a trade agreement was reached in February that included the cancellation of punitive tariffs.
Strategic Reserves and Alternative Supply Sources
Since February, the volume of Russian oil imports to India has decreased to a minimum—nearly 1 million barrels per day, which is about half of the peak levels and the lowest since September 2022. The majority of this reduction has been offset by supplies from Middle Eastern countries.
According to representatives of India’s Ministry of Petroleum, the country’s commercial and strategic reserves are currently sufficient for approximately two weeks. At the same time, the Indian side has approached the Ministry of Foreign Affairs with a request for greater flexibility in import matters from the United States. At the end of last week, 9.5 million barrels of Russian oil were in Asian waters.
“Officials emphasize that India’s refineries are considering several options in case of prolonged supply disruptions due to Iran: utilizing strategic oil reserves, accelerating purchases from Venezuela, and stimulating domestic production.”
Additionally, Indian officials have reached out to Saudi Aramco with a request to increase oil supplies via pipeline to the Yanbu port in the Red Sea, which would allow for avoiding transportation through the Strait of Hormuz and reduce risks associated with conflicts in the region.