Virendra Pandit
New Delhi: Amid the ongoing West Asian war since February 28, involving a dozen oil producing countries, and likely energy crisis ahead, Indian refiners have purchased nearly 30 million barrels of Russian crude oil, the media reported on Wednesday.
A section of the media claimed this was the first purchase after the so-called US claims of a temporary, 30-day ‘waiver,’ which New Delhi rejected saying it had already been purchasing from Russia and other countries.
Since the last few months, India, which was negotiating a trade-cum-tariff deal with the US, had been winding down its purchases of Russian oil, filling the gap with replacement barrels from Saudi Arabia and Iraq — only to find supplies cut off by a widening conflict in the West Asia.
The key waterway of Strait of Hormuz, which connects the volatile region’s major producers to the rest of the world, particularly Asia, has been effectively closed since US and Israeli strikes on Iran began.
Since the last week’s so-called US ‘waiver’, refiners in the South Asian nation including Indian Oil Corporation Ltd (IOCL). and Reliance Industries Ltd. (RIL) have snapped up all unsold cargoes of Russian crude in the spot market.
The oil was loaded but uncommitted, and much of it was already in Asian waters.
Russian crude — comprising a broad sweep of grades including Urals, ESPO and Varandey — has been offered at premiums of between USD 2 and USD 8 a barrel to London’s Dated Brent benchmark Before the war in West Asia, Russian oil traded at discounts to the same marker.
Around 10 million barrels of the Russian crude was bought by state-owned Indian Oil, while Reliance purchased at least as much, the traders said.
The US ‘waiver’ covered transactions related to Russian crude and petroleum products loaded onto vessels before March 5, so long as it’s delivered to India and purchased by an Indian firm.
Since then, tankers that had been moving away from the subcontinent have u-turned. Among them, the Maylo and the Sarah — carrying Urals loaded at Russia’s western ports — have changed course to head towards India after originally signaling Singapore as their destination.
The shift isn’t limited to cargoes from Russia’s west. The Oasis and Noble Walker, laden with ESPO from the country’s Far East, have also altered course after initially signaling China.
India, which didn’t traditionally take much Russian oil, ramped up purchases after the invasion of Ukraine in February 2022 — eventually incurring the wrath of the Trump administration, which was eager to crank up pressure on the Kremlin. Russian oil is not itself sanctioned, but Washington has blacklisted the country’s two largest producers.
Buying peaked at more than 2 million barrels a day in mid-2024, but dropped to an average of 1.06 million barrels a day in February, according to data intelligence firm Kpler.
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