India's Russian Crude Imports Fall to Five-Month Low as Refiners Diversify Supplies
India's total crude imports averaged about 5.3 million barrels a day in September, up roughly 600,000 barrels per day (bpd) from August and 700,000 barrels a day from a year earlier
New Delhi: India’s imports of Russian crude dipped by 1.75 million barrels a day in September, as refiners diversified purchases amid geopolitical risks, even as the country’s overall crude intake rose sharply on stronger refinery runs, analytics firm Kpler said on Monday.
As per the Kpler data, India's total crude imports averaged about 5.3 million barrels a day in September, up roughly 600,000 barrels per day (bpd) from August and 700,000 barrels a day from a year earlier. “India imported an average of 1.74 million bpd of Russian crude in September. The volumes imported were the lowest since 1.58 million bpd of Russian crude imports in April. It compared with 2.02 million bpd of Russian imports in August and 2.65 million bpd in July,” the data and analytics firm said.
Commenting on the data, Sumit Ritolia, senior manager (modelling) at Kpler said that the decline in Russian flows comes as Washington continues to pressure buyers of Russian oil, prompting Indian refiners to keep their sourcing options flexible. “Russia nevertheless remains a major component of India's crude basket, with buying decisions continuing to be driven primarily by economics, availability and refinery compatibility,” he said.
“The latest reduction in Russian volumes does not indicate a wholesale shift away from Russian crude, but Indian refiners could exercise greater caution if the US announces unilateral punitive measures targeting India over purchases of Russian oil,” he added.
Iraq and Saudi Arabia made up for the drop in Russian volumes. Iraq supplied some 575,000 bpd of crude this month, up from 163,000 in August. Saudi volumes also rose to 566,000 bpd in September from 347,000 bpd last month. The UAE supplied 480,000 bpd, down from 546,000 bpd in August.
Ritolia, however, said that during any period of uncertainty, refiners could reduce - rather than halt - Russian purchases while assessing enforcement, potential waivers and the availability of alternative supplies, a pattern seen during previous periods of heightened scrutiny.
“The decline in Russian crude has been offset in large part by higher Middle Eastern supplies and imports from the region are estimated at about 3 mbd in September, broadly returning to pre-war levels, with higher flows from Iraq, Kuwait and Saudi Arabia,” he said.
As per Kpler, improving crude movements through the Strait of Hormuz, along with ship-to-ship transfers and other logistical arrangements, have helped Indian refiners rebuild Middle Eastern purchases as regional supply availability improves.
“African and Venezuelan barrels have also contributed to the diversification of India’s crude slate, highlighting refiners' ability to switch between suppliers as relative prices, availability and geopolitical risks change,” it said.