Russia becomes the No. 1 oil supplier for India in October

Russia has become India’s top oil supplier, edging past the traditionally dominant suppliers Saudi Arabia and Iraq, according to the energy cargo tracker Vortexa.

Russia supplied 946,000 barrels per day of crude to India in October, the highest ever in a month. It accounted for 22% of India’s total crude imports, ahead of Iraq’s 20.5% and Saudi Arabia’s 16%. Compared to September, overall crude import went up 5% in October and that from Russia rose 8%, according to Vortexa, an energy intelligence firm that has offices in Singapore and London and tracks oil and gas tankers across the globe, providing freight and inventories analytics.

For the first time, India imported more seaborne Russian crude than the European Union – the volumes were 34% higher than the EU’s. With imports of 1 million barrels per day in October, China remained the largest buyer of Russian seaborne crude.

India also imported about 106,000 barrels per day of fuel oil from Russia in October, a new high.

The dramatic rise in Russia’s share of the Indian market from less than 1% in 2021 was triggered by the deep discounts that followed the February invasion of Ukraine.

West’s Proposed Price Cap

The war and the consequent Western sanctions unsettled the global market and sent prices higher but forced Russia to sell its crude at a deep discount.

The latest oil ministry data shows that the share of Eurasia, including Russia, Kazakhstan and Azerbaijan, has expanded to 21% in the April-September period from 5% a year earlier. This has led to a near halving of the combined share of North America, South America and Africa to 18% from a year earlier while the Middle East’s share remained almost intact at around 59%.

A spokesperson for the oil ministry didn’t respond to ET’s request for comment on the story. The government has defended India’s purchase of Russian oil on multiple occasions in the past.

“If India did not buy or someone else didn’t buy Russian oil, and Russian oil was to go off the market, what would happen to International prices?” oil minister Hardeep Puri told CNN on Monday, adding that the market disruption could send prices to $200 per barrel. He said India will buy oil and gas from wherever it can as the government has a “moral duty” to keep its population supplied with energy.

Some analysts feel India’s imports from Russia could slow from December due to shipping constraints that could possibly emerge from the West’s proposed price cap on Russian oil.

“There remains much uncertainty on whether Russian crude deliveries can be sustained at this level post the December 5 EU ban, with the availability of ice-class tankers to transport crude from the Russian Baltic ports being one of the biggest constraints,” said Serena Huang, an analyst at Vortexa.