Russian oil imports to India are expected to remain close to record highs in April and May, supported by a renewed U.S. sanctions waiver and steady supply arrangements through non-sanctioned entities and vessels. India, already the largest buyer of Russia’s flagship Urals crude and the second-largest importer of Russian crude after China, continues to strengthen its energy ties with Moscow despite ongoing geopolitical tensions.
The sustained flow of Russian crude is significant not only for India’s energy security but also for Russia’s economy, as oil revenues remain a major source of funding amid rising military spending related to the Ukraine conflict.
Record Volumes in March Strengthen the Trend
March marked a major milestone for Russian oil imports to India, with shipments reaching a record 2.25 million barrels per day (bpd). This was nearly double the volume recorded in February and accounted for almost 50% of India’s total crude oil imports during the month.
This sharp increase reflects India’s growing dependence on discounted Russian crude, which has become an attractive option for refiners looking to manage costs in a volatile global market. Lower prices and stable availability have made Russian oil a preferred choice for both public and private refiners across the country.
The trend has continued into April, with arrivals at Indian ports expected to touch 2.1 million bpd during the week of April 20 to 27, compared to 1.67 million bpd the previous week.
Temporary Dip Linked to Export Disruptions
There was a slight drop in Russian deliveries in mid-April, which caused some worries, but traders and market analysts reckon that the drop was short-lived. This decline was probably due to disruption of exports due to Ukrainian drone attacks of Russian ports at the end of March.
These attacks had impacts on loading operations and caused some shipments to be delayed but the entire supply chain soon got adjusted. Russian crude supplies are projected to be above 2 million bpd throughout the entire month of April, expectations of the sources that are in the trade.
This stability indicates that Russian oil imports to India are resilient to say the least because it may actually increase more in May assuming that the current pattern of trade persists.
U.S. Sanctions Waiver Supports Market Stability
A major factor that has contributed to the high level of imports is the fact that the U.S. has decided to renew a sanctions waiver allowing nations to buy sanctioned Russian oil and petroleum products. The 30-day waiver was initially issued by Washington in mid-March to avoid significant energy markets disruptions in the world especially when there are tensions associated with the Iran conflict.
The waiver was once more increased last week providing flexibility and confidence to the importers such as India in holding on to the supply agreements.
Despite U.S. sanctions being aimed at pressuring Moscow to negotiate peace with Ukraine, traders observe that shipments to India have mostly gone on, by using non-sanctioned businesses throughout the supply chain. This has enabled business to go on without significant legal or logistical hindrances.
Indian Refiners Secure May Deliveries Early
The Indian refiners went ahead to book May deliveries even before the latest waiver extension was officially declared. According to traders, the majority of the volumes needed in May were already covered by the end of last week.
Refineries are now paying Russian oil cargoes arriving in May at a premium of between 7-9 per barrel above dated Brent, which is equal to April imports. With these premiums, Russian crude is still affordable because of the good price and reliability of supply in the long run.
This high demand puts a strategic value on the Russian oil imports to India, particularly because the nation aims to cover the increasing domestic fuel demand and the demand in the industries.
Expanded Insurance Support Strengthens Trade
India has also gone to the extent of facilitating the import process by increasing the list of approved Russian insurers offering marine cover to ships that dock in ports in India. Directorate General of Shipping added new insurers of Russian origin to eight to eleven.
This action enhances shipping confidence and facilitates continuity in trading among companies without worrying about compliance and operational risks.
Conclusion
The future of Russian oil imports to India looks bright with high levels of April and May reports and good demand. As U.S. sanctions are waivered, and there are stable non-sanctioned supply routes, and enabling policy provisions by India, the trade relationship is hoped to be strong.
With the world energy markets persisting to be uncertain, India has shown its pragmatic approach to achieving economic stability and energy security by depending on cheap Russian crude.
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