Russia becomes India’s top oil supplier

Russia’s crude oil exports to India rose to 277,000 bpd in April, from 66,000 bpd recorded the previous month, according to Reuters, citing data provided by trade sources.

The increase boosted Russian crude’s share in India’s oil purchases to a record 6%, making Russia the fourth-largest supplier to the country. India is the third largest oil importer and consumer in the world.

Western sanctions against Moscow have opened the door for Indian refiners to increase purchases of Russian oil at a discount, as some European customers abandon Russian crude.

Oil Corporation of India, the country’s top refiner, bought the first batch of Russian oil in March.

Ehsan Ul Haq, analyst at Refinitiv, said that the price of Russian Urals crude oil fell sharply due to the orders punish Russia while Kazakhstan’s CPC blend crude was under pressure as it was unloaded from a Russian port.

Meanwhile, Africa’s share of India’s total oil imports fell to around 6% in April, from 14.5% in March, while supply from the US fell by almost half to 3.5%. %. In total, oil from Azerbaijan, Russia and Kazakhstan accounted for about 11% of India’s oil imports in April, compared with about 3% in March.

Higher imports from Russia caused OPEC’s share of India’s supply to plummet to a record low in April.

According to preliminary data from Refinitiv, India’s oil purchases from Russia are expected to continue to grow to around 487,500 bpd this month, as refiners have ramped up imports.

Meanwhile, Indian oil companies are trying to cash in on cheap Russian crude. Maintenance work at India’s Reliance Industries, the world’s largest refinery complex, has been postponed to process discounted Russian crude. The company is working to produce more oil products as profits recently jumped to a three-year high, as reported by Bloomberg.

Reliance Industries bought cheap oil from Russia after European customers refused to buy Russian crude, sending margins on products like diesel and naphtha skyrocketing.

In January-March, margins for diesel were up 71% from the previous quarter, while for gasoline by 17% and for naphtha by 18.5%.

Reliance’s refinery complex can process nearly 1.4 million barrels per day of most crude grades. The company is said to be famous for its flexibility in oil trading, allowing it to benefit from price changes.

As EU member states are still seeking consensus on a Russian oil embargo, some European customers have stopped buying Russian crude over the past few months. The potential ban comes as part of a sixth package of sanctions the EU has imposed on Moscow in response to the military campaign in Moscow. Ukraine.

Meanwhile, Indian importers have increased their purchases of Russian crude oil and coal at discounted prices, shifting their strategy from bidding to negotiating for bigger discounts.

According to media reports, India’s state-owned and private refineries have purchased more than 40 million barrels of Russian oil since the end of February, when the military operation kicked off.

The media reports that India is bargaining with Russia to reduce oil prices below 70 USD/barrel.