Why Indian Refiners Are Seizing the Opportunity with Increased Russian Crude Purchases Amid Major Urals Discounts

Indian refiners are set to increase their purchases of Russian crude oil in the coming months. A recent report from Bloomberg highlights that the discounts on Urals crude are widening, making it more attractive for buyers.

Currently, Urals cargoes for November are priced about $2 to $2.50 below Dated Brent. This difference has roughly doubled since July and August when Moscow focused on its domestic market and limited exports. As a result, ship-tracking data show an uptick in Russian crude oil arrivals in India, estimated to average 1.7 million barrels per day in October. This marks a 6% rise from September and is close to last year’s levels, according to Kpler data.

This potential increase in imports comes even amidst rising tariffs from the U.S. In August, the U.S. raised duties on many Indian imports, reaching up to 50%. These tariffs were partly tied to India’s ongoing purchases of Russian oil. Despite this pressure, Indian officials are still in discussions with U.S. representatives for a broader trade deal, describing recent meetings as positive.

Interestingly, a government source from India mentioned to Reuters that there’s “enough” Russian crude available in the market for Indian refiners, aided by a decrease in Russia’s domestic oil processing. Prior reports indicate that Indian imports of Russian oil currently represent about one-third of its total supply, hovering around 1.61 million barrels per day.

As of October 2023, social media reactions show mixed sentiments regarding India’s trade with Russia. Some users express concern over the implications of these purchases, while others emphasize India’s right to secure its energy supplies amid global tensions.

These dynamics not only affect the energy market but also underline the complex interplay between international relations and economic decisions. The evolving situation serves as a reminder of how geopolitical factors can drive market changes.

For further insights into global oil dynamics, consider checking out reputable sources like Reuters.

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