Indian Russian oil imports will increase in September which is contrary to the US
Russian oil exports to India will increase in September, traders said, when producers cut prices to sell more raw because they could not process as much as the refinery damaged by the Ukrainian drone attack on energy infrastructure.
India has become the biggest buyer of Russian oil supply which was moved by Western sanctions after Moscow invaded Ukraine in 2022. This allows Indian refiners to benefit from cheaper crude oil.
But the purchase has attracted criticism from the government of US President Donald Trump, which increased US tariffs for India’s import to 50% on Wednesday.
New Delhi said that relying on talks to try to complete Trump’s additional tariffs, but Prime Minister Narendra Modi has also started a tour to develop diplomatic relations in other places, including meeting with Russian President Vladimir Putin.
US officials accuse India of being profiten from Russian oil discounts, while Indian officials accuse double standards in the west of the European Union and the US still bought Russian goods worth billions of dollars.
The Indian Ministry of Oil did not immediately respond to requests for comments on Thursday.
Without India, Russia will struggle to maintain exports at the existing level, and that will cut oil export revenues that finance the Russian Kremlin Budget and Sustainable War in Ukraine.
Three sources of trading involved in oil sales to India said Indian refiners would increase the purchase of Russian oil in September by 10-20% from the August level, or 150,000-300,000 barrels per day. Sources, who quote initial purchase data, cannot be mentioned because they are not authorized to speak publicly about this problem.
The two largest Russian oil buyers for India, Reliance and Nayara Energy, which are owned by the majority of Russia, did not immediately respond to requests for comments.
Russia has more oil to be exported next month because the planned and unplanned refinery blackout has cut its capacity to process crude oil into fuel. Ukraine has attacked 10 Russian refineries in the last few days, taking offline as much as 17% of the country’s purification capacity.
In the first 20 days of August, India imported 1.5 million barrels per day of Russian crude oil, not changing from July but slightly below an average of 1.6 million BPD in January-June, according to data from Vortexa analyst.
This volume is the same as about 1.5% of the global supply, making India the largest buyer of Russian crude oil in the sea, which covers about 40% of Indian oil needs. China and Türkiye are also large buyers of Russian oil.
India will continue the purchase?
Increasing Russian oil purchases over the past few years has harmed a more expensive supply of oil -exporting state organizations. OPEC’s share rose in 2024 after a decline of eight years.
Russian exporters sell coarse loading Ural in September with a discount of $ 2-3 $ 3 per barrel for benchmark dated Brent, the three traders said.
The level is cheaper than a $ 1.50 discount per barrel in August, which is narrowed since 2022, the traders said.
“Unless India issued a clear policy direction or the trading economy shifted significantly, Russian crude oil would likely remain a core part of a mixture of supply,” said Sumit Ritolia of the KPler.
The CLSA broker in a record also estimates that only “Indian limited opportunities that stop Russia’s imports” unless the global prohibition is imposed.
He also said that if Indian Russian crude oil imports were stopped, the impact of the knock-on could reduce the global supply of around one million BPD and cause a short-term surge in global price to nearly $ 100 per barrel.
Traders say the full impact of sanctions and tariffs can only be seen in the cargo that arrives in India in October, which will start trading in the next few days.
In addition to US tariffs, the European Union also tightened the price of the price designed to limit Russian oil income, which will complicate sales later this year.
The EU has set a limit of $ 47.60 per barrel from September 2 – 15% below the price of the Russian crude oil market – limiting access to western services for cargo sold above the boundaries.
Source: Reuters
