Indian State-Owned Refiners Push to Reignite Russian Oil Supply: What It Means for the Market

State-owned oil refiners in India are keen to resume buying discounted Russian crude oil, despite pressure from the U.S. However, their plans face hurdles due to a shortage of available shipments. Recently, offers for Russian oil loading in October have dwindled, as more barrels have been redirected toward China.

Adding to the challenge, Russian oil now competes with suppliers from other countries, making it harder for Indian refiners to secure these imports. The global oil scene is closely watching India’s purchasing choices, especially after the U.S. raised tariffs on many imports from India in an attempt to curb Russian oil shipments. While the sanctions remain active, U.S. rhetoric has softened lately, suggesting a more diplomatic approach.

Moreover, the recent decision by OPEC+ to ease supply restrictions may give producers, including those from the Middle East and Russia, more options to increase their exports.

Indian Oil Corporation’s Director of Finance, Anuj Jain, confirmed that they have not ceased purchases of Russian crude. He mentioned that the current discount on Russian oil is between $2 and $3 per barrel compared to the Dubai benchmark. This price advantage is appealing for Indian refiners, allowing them to continue sourcing oil based on market dynamics.

Indian Finance Minister Nirmala Sitharaman reiterated the government’s stance, stating that India would persist in its oil imports from Russia, rejecting U.S. pressure. Earlier, Oil Minister Hardeep Puri also publicly disagreed with the U.S. position on Russian crude.

Recent data shows that Russia’s crude oil deliveries to India have gradually decreased, from 1.97 million barrels per day in March to 1.3 million by the end of August. Experts predict India might reduce its imports by about 250,000 barrels daily in the coming weeks, as peak demand seems to have passed.

The U.S. has imposed these levies as part of a strategy to pressure Russia to halt its actions in Ukraine. Discussions continue among U.S. and European officials about potential new sanctions aimed at economically isolating Russia, hoping such measures will push President Putin toward peace negotiations.

In summary, while Indian refiners are determined to secure Russian oil amidst geopolitical struggles, market factors and international relations are reshaping their strategies significantly.



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Oil & Gas,CRUDE,Russian oil