Russia has soared up the Indian oil supplier league table, rising to be the fourth-largest source country in April from tenth spot in March, trade data shows.
Western sanctions against Moscow over the invasion of Ukraine has prompted Indian refiners to increase their purchases of the cheaper Russian oil shunned by many other countries.
Russia’s share of India’s oil purchases rose to a record 6%, about 277,000 barrels per day (bpd) in April, up from about 66,000 bpd in March, tanker tracking data showed.
Indian Oil Corporation, the country’s top refiner, bought its first-ever Russian Arco oil cargo last month.
“Prices of Russian Urals crude fell sharply due to sanctions against Russia while Kazakhstan’s CPC blend crude came under pressure as it is loaded from a Russian port,” said Ehsan Ul Haq, an analyst with Refinitiv.
Indian traders bought stranded Russian oil while some European buyers had picked up higher volumes of African and US oil, he said.
The share of African oil in India’s overall oil imports declined to about 6% in April from 14.5% in March, while that of the US almost halved to 3%.
Grades from Azerbaijan, Russia and Kazakhstan together accounted for about 11% of India’s imported oil in April, compared with about 3% in March. The share of Middle Eastern oil rose to 71% from 68%.
India’s oil imports from Russia are set to rise further to about 487,500 bpd in May, since refiners have ramped up purchases from Russia, preliminary data from Refinitiv flows show.
Last month, Iraq continued to be the top oil supplier to India, followed by Saudi Arabia and the United Arab Emirates.
In April, Indian refiners shipped in 4.7 million bpd of oil, up 6.9% from the previous month and about 11.6% higher than a year earlier, when a second Covid-19 wave hit local oil demand.
India’s oil imports in April were high as refiners raised runs to meet local demand and gain from robust refining margins, Haq said.
“Also the companies got Russian grades at very tempting rates and they had to lift committed volumes under term contract with Middle Eastern producers,” Haq said.
The higher imports from Russia dragged down OPEC’s share of foreign supplies to India in April.
- Reuters, with additional editing by George Russell