Indian state-run refiners are turning back to Russian crude after a brief pause, driven by improved discounts and shifting global demand.
Key Update
Officials confirmed that Indian Oil Corporation (IOC) and Bharat Petroleum Corporation Ltd (BPCL) have resumed purchases of Russia’s flagship Urals crude grade for September delivery.
- Discounts widened to around $3 per barrel, making Russian barrels more attractive.
- Purchases had been halted in July when discounts narrowed and margins became less viable.
- Rising Chinese demand for Russian crude has further reshaped regional market dynamics, pushing Indian refiners to lock in deals before prices tighten again.
Why It Matters
India has emerged as one of the largest buyers of Russian oil since 2022, capitalizing on price discounts following Western sanctions on Moscow.
- The resumption indicates India’s continued balancing act—ensuring affordable energy while navigating geopolitical pressures.
- Wider discounts improve refining margins for state-run oil companies and help India manage its import bill.
Global Energy Context
- China has increased its Russian oil purchases, adding competition in Asia for discounted cargoes.
- As OPEC+ supply cuts tighten availability of Middle Eastern grades, Russian Urals continue to offer a cost-effective alternative.
- Analysts note that any U.S. or European escalation of secondary sanctions could complicate India’s sourcing strategy.
✅ Disclaimer: This article is for informational purposes only. The views expressed are not investment or trading advice.