India’s oil imports from Russia reached a record high of about 2.1 million barrels per day (bpd) in May, accounting for nearly 41% of the country’s total oil imports. This surge in Russian oil imports can be attributed to the widening discounts on Russian oil due to lower demand from China.
Meanwhile, India’s oil imports from Saudi Arabia dropped to a 10-month low as Saudi Aramco hiked term prices for a second consecutive month in May. India’s total oil imports grew by about 5.6% in May compared to April, reaching around 5.1 million bpd.
The increased intake of Russian oil has been denting the share of Middle Eastern oil in India’s crude mix, as well as the share of oil producers’ cartel OPEC. This shift in India’s oil sourcing is driven by the availability of Russian oil at better discounts, compared to the more expensive grades from regions like the Middle East.
Indian private refiners, such as Reliance Industries and Nayara Energy, have signed term deals to buy Russian oil, while state-owned refiners are purchasing from the spot market. Russia has maintained its position as the top oil supplier to India, followed by Iraq and Saudi Arabia.
The data also shows that India received 176,000 bpd of oil from the United States in May. The higher intake of Russian oil has been a significant shift in India’s oil import dynamics, as the country seeks to secure its energy needs amidst the ongoing global supply challenges.