Russian Exports Of Crude Oil To India Surge During March

Indian imports of Russian crude oil have rebounded significantly in March, with lower prices making it more economical for Indian refiners, according to India’s Financial Express media yesterday (March 24).

The cheaper prices have also led to an increase in the availability of non-sanctioned tankers, making it easier for Indian companies to transport oil. As a result, India’s Russian oil imports have rebounded in March after a decline in previous months. According to data from Kpler, the ship tracking analyst, India’s Russian oil imports significantly increased in the first 21 days of the month, averaging 1.85 million barrels per day (bpd). This represents a substantial rise from the 1.47 million bpd imported in February and the 1.64 million bpd imported in January.

Russian oil accounts for over 35% of India’s total oil imports in March, up from approximately 31% in February.

Following the introduction of further Western sanctions against Moscow in February, India stated it would continue to buy Russian oil as long as it was sold below a US$60 per barrel price cap, transported on non-sanctioned tankers, and the transaction did not involve sanctioned companies or individuals.

Russia’s domestic crude demand had declined in February and March due to a milder than expected winter, meaning the subsequent additional availability of Russian crude began driving down Urals (Russia’s flagship oil grade) prices, with average prices assessed at US$59.9 per barrel in February and US$56 per barrel in March. This implies that Urals crude remains below the G7 sanctions price cap, which enables buyers and sellers to utilize Western shipping and insurance services for transportation.

Indian crude oil imports from Russia fell last month to their lowest level since January 2023, with the decline occurring just weeks after the US imposed sanctions on several Russian energy companies and multiple oil tankers. The sanctions imposed by the US and UK targeted Russian oil producers, including Gazprom Neft and Surgutneftegas, as well as 183 tankers involved in transporting Russian crude oil.

The measures had an impact on both India, the world’s third-largest oil importer, which heavily relies on seaborne crude shipments, and China, the world’s largest importer.

Speaking in New Delhi last month, Russian First Deputy Energy Minister Pavel Sorokin said that Moscow would continue to supply oil to global markets, including India. “We are pragmatic. We value our relationships, and we will continue to supply the market. Our resources are internationally competitive.”