Informist, Tuesday, Jul 2, 2024

By Sayantan Sarkar

NEW DELHI – India's imports of crude oil from Russia remained robust in June, rising to 1.97 mln bbl per day from 1.91 mln bpd in the same month last year, according to data from energy cargo tracking firm Vortexa. Oil imports from Russia increased for the sixth straight month, according to the data. Sequentially, oil imports from Russia rose 15% in June.

Crude oil shipments to India from Russia rose to a 12-month high as offtake by China fell, making more discounted crude available to other buyers, Serena Huang, head of Asia Pacific analysis at Vortexa, told Informist.

Exports of crude oil products by India were at 1.2 mln bpd in June, at similar levels as the previous couple of months, she added.

Russia's share in India's crude oil imports started to rise in March 2022 after several Western powers such as the US and the UK imposed sanctions on Moscow's oil exports following its invasion of Ukraine. In February 2022, Moscow accounted for just 1% of New Delhi's oil imports. Part of the reason for higher imports from Russia was the steep discounts the country offered, as the Western world shunned Moscow's crude.

India's total crude oil imports in June were 4.62 mln bpd, marginally down from 4.65 mln bpd in the same period last year. Imports from Saudi Arabia, which had the second-largest share in India's import basket before the war in Ukraine began, slipped to just 386,469 bpd in June.

Iraq exported 753,658 bpd of crude oil to India in June, compared with 777,000 bpd in the corresponding period a year ago, data from Vortexa showed. Iraq was the top oil supplier to India before Russia's invasion of Ukraine. The United Arab Emirates and the US round off the top five countries that India imported crude oil from last month. Imports from the UAE were 372,707 bpd, while those from the US were 331,008 bpd.

For exports of crude oil products by India in June, the top destinations are Southeast Asia, West Asia, and northwestern Europe, Huang said. India exported a total of 208,000 bpd of oil products to Southeast Asia and 156,000 bpd to the West Asian region, according to Huang. Northwest Europe imported 88,000 bpd of crude oil products from India last month.

India's exports of oil products have slipped from a high of 1.37 mln bpd in March to around 1.20 mln bpd in the last few months, according to the data. In April, exports had fallen to just 1.15 mln bpd, Vortexa data showed.

Though geopolitical tensions in West Asia continue to simmer, freight costs have remained largely manageable. "Due to ample tonnage supplies and bearish demand, dirty tanker freight rates from the Middle East have come under immense pressure recently, offsetting the impact of higher geopolitical tensions," Huang said.

Oil tankers are categorised as dirty or clean. Dirty tankers carry crude oil or unrefined products such as gasoil, residual fuel, or others, while clean tankers carry refined products such as petrol and diesel.

Crude oil prices have risen in the last few weeks, supported by tightening inventories and rising geopolitical tensions in the Middle East, Huang said. "But the price growth momentum has lost steam in recent days as downside risks (to) oil demand are offsetting pressures of tighter supply," she added.

At the time of writing, the price of Brent crude oil on the Intercontinental Exchange was at $87.22 per bbl, up 0.7% from the previous close, while that of West Texas Intermediate crude on the New York Mercantile Exchange was $83.99 a bbl. End

US$1 = 83.51 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Rajeev Pai

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