The latest US sanctions against Moscow have reportedly had a “marginal and short-lived impact” on trade
Indian imports of Russian crude oil jumped to a nine-month high in April, despite US sanctions against Russia’s largest shipping company, the Indian Express newspaper reported on Friday, citing vessel tracking data and industry watchers.
Indian refiners imported a total of 1.96 million barrels per day (bpd) of Russian crude in April, the highest since July of last year, the outlet said in a report based on provisional ship-tracking data from commodity market analytics firm Kpler. The figure is nearly 19% higher than volumes imported in March, the data suggests. Russia accounted for 40.3% of India’s total crude oil imports in April, recovering from a decline to around 33% in the past four months, the publication added.
The US and its allies recently blacklisted a number of intermediaries and individual vessels for carrying Russian oil above the G7 price cap of $60 per barrel. In February, Washington targeted Russian oil tanker company Sovcomflot and more than a dozen vessels linked to the state-owned firm. The measures caused payment issues and a slight drop in crude sales in late 2023 and early this year. The sanctions, however, have only had a marginal and short-lived impact on Russian oil flows to India, trade sources told the Indian Express.
The newspaper quoted the head of crude analysis at Kpler, Viktor Katona, as suggesting that Ukrainian drone strikes on Russian refining infrastructure earlier this year prompted the country’s oil producers to export surplus crude that could not be refined. That made greater volumes available to Indian buyers.
Since January, Ukraine has launched a series of long-range drone attacks on Russian energy facilities, including oil depots and refineries. Russia, however, has been able to swiftly repair some of the refineries, reducing capacity idled by the strikes to about 10% in mid-April from almost 14% at the end of March, according to Reuters.
Refiners in India have become major buyers of Russian crude since Western importers ceased purchases as part of sanctions. Moscow began offering large discounts on its crude to attract new markets following the loss of its traditional buyers.
India has saved an estimated $13 billion on oil imports over the past two years by snapping up discounted Russian crude, the Times of India reported this week, citing data compiled by ratings agency ICRA Research.
India is Asia’s third-biggest economy and the world’s third-largest oil consumer. Its dependence on imported crude soared to 87.7% in the financial year from April 2023 to March 2024, according to the Oil Ministry’s Petroleum Planning and Analysis Cell (PPAC). Analysts point out that a lower oil import bill is keeping the Indian government’s fiscal math on track and helping the country to combat inflation.
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