Ashish Ranjan
India’s Russian oil imports record high in Feb: In February, India’s Russian oil imports reached a record high of 1,6 million barrels per day, surpassing the combined imports from traditional suppliers Iraq and Saudi Arabia.
According to energy cargo tracker Vortex, Russia remained India’s primary supplier of crude oil, which is refined into gasoline and diesel, for the fifth consecutive month, supplying more than one-third of all oil India imported.
Refiners continue to purchase abundant Russian cargoes offered at a discount relative to other grades.Before the beginning of the Russia-Ukraine conflict in February 2022, Russia’s market share in India’s import basket was less than 1%. In February 2022, Russia’s share of India’s imports increased to 1.62 million barrels per day, or 35%.
India, the world’s third-largest crude importer after China and the United States, has been snapping up discounted Russian oil after some Western nations shunned it to penalise Moscow for its invasion of Ukraine.The increase in Russian imports has harmed Saudi Arabia and the United States. Oil imports from Saudi Arabia decreased 16% month-over-month, while those from the United States fell 38%.
According to Vortexa, Russia now supplies more crude to India than Iraq and Saudi Arabia combined, the country’s primary oil suppliers for decades.In February, Iraq supplied 9,39,921 barrels per day (bpd) of oil while Saudi Arabia supplied 6,47,813 barrels per day (bpd) of oil to India, displacing Russia as India’s largest oil supplier.
UAE surpassed the United States to become the fourth greatest supplier, at 4,04,570 bpd. The United States supplied 2,48,430 bpd in February, down from 3,99,914 bpd in January.According to Vortexa’s director of Asia-Pacific analysis, Serena Huang, Indian refiners’ refining margins are increasing as a result of processing discounted Russian crude.
As long as economic conditions are favourable and financial and logistical services are available to support the trade, the demand for Russian cargoes by refiners is likely to remain robust. Russia is shipping record quantities of crude oil to India to make up for the European Union’s December ban on energy imports.
In December, the EU prohibited the shipment of Russian oil by sea and imposed a price limit of USD 60 per barrel, preventing other nations from using EU shipping and insurance services unless oil is sold below the cap.
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According to industry officials, Indian refiners use UAE dirhams to pay for oil imported for less than USD 60 per barrel.An official stated that nearly a quarter of all Russian imports are now paid for in dirhams.Before the beginning of the Russia-Ukraine conflict, Russia’s market share in India’s import basket was only 0.2%. By February 2023, Russia’s market share in India’s imports had risen to 35%.
