Russia remained India’s top supplier of crude oil, which is refined at refineries into gasoline and diesel, for the fifth straight month, supplying more than a third of New Delhi’s imported oil, according to energy cargo tracker Vortexa.
Indian refiners buy the plentiful Russian cargoes, which are available at a discount on other grades.
From a market share of less than 1 percent of India’s import basket before the start of the Russia-Ukraine conflict in February 2022, Russia’s share of Indian imports rose to 1.62 million barrels per day in February, with a 35 percent stake in the sector .
India, the world’s third-biggest importer of crude oil after China and the United States, is buying Russian oil at a discount after some Western countries refused to punish Moscow.
Meanwhile, Indian oil imports from Saudi Arabia fell 16 percent month-on-month and those from the United States fell 38 percent.
According to Vortexa, Russia now accounts for more than the combined oil bought from Iraq and Saudi Arabia, India’s main fuel supplier for decades.
Iraq supplied New Delhi with 939,921 barrels of oil per day (bpd) in February, while Saudi Arabia put together 647,813.
The United Arab Emirates, in turn, became India’s fourth largest supplier with 404,570 bpd and the United States supplied 248,430 bpd, compared to 399,914 in January.
Shipments from Iraq and Saudi Arabia to India are the lowest in 16 months.
Indian refiners are enjoying an increase in their refining margins thanks to the refining of discounted Russian crude, said Vortexa’s head of Asia-Pacific research Serena Huang.
Appetite to import Russian casks is likely to remain strong as long as economic conditions are favorable and financial and logistics services are available to support trade.
Russia is selling record amounts of crude oil to India to fill shortages of energy exports after the European Union banned imports in December. Brussels has slammed the shipping of Russian oil by sea, imposing a price cap of $60 a barrel, preventing other countries from using the community’s shipping and insurance services unless the crude oil is sold below the cap.
On the other hand, industry officials say Indian refiners use the dirham, the UAE’s legal tender, to pay for imported oil under $60.
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