India imported crude oil worth $14.7 billion from Russia in the June quarter (Q1), according to government data. This was 25 per cent more than the same period last year, with higher availability and India’s growing appetite for Russian crude vis-à-vis other countries playing a part in this growth story.

Shipments carrying Russian crude worth $4.6 billion landed in June, lower than the $5.8 billion in May, data from the Commerce Department showed.

Despite this, Russia held 36.6 per cent share in Indian crude imports by value in Q1, up slightly from 35.8 per cent in the same quarter last year. The share rose every month in Q1, rising from 32.5 per cent in April to 36.6 per cent in May, and finishing at 41.2 per cent in June.

In May, industry sources had told Business Standard that crude oil purchases in Q1FY25 would remain tilted towards Russia if Brent crude prices remained above $81 per barrel. Prices remained above that level for almost the entirety of April and May, and most of June.

In Q1, India’s overall crude oil imports rose 22.3 per cent to $40.2 billion, up from $33 billion in Q1FY24. Crude from 22 countries reached India, compared to 24 countries in the year-ago period.

Industry sources said imports from Russia are set to rise in the coming months even though Russian refiners are set to ramp up domestic fuel production. However, Russian shipments would face tough competition from crude supplies coming from United Arab Emirates and Iraq, which have risen by 90 per cent and 13.5 per cent, respectively, on a volume basis in the first quarter of FY25.

While official figures are not available, the share of Russian crude in India’s imports stood at 40 per cent in July, according to estimates made available by London-based commodity data analytics provider Vortexa, which tracks ship movements to estimate imports.

This was down from 42 per cent and 37 per cent in the preceding two months. The share has remained relatively steady after falling to a low of 28 per cent in March.

This is due to the level of discounts remaining broadly stable in Q1, a refinery official said. It has remained in the range of $4-6/bbl in 2024 so far, he added. After shrinking for a few months in May, 2023, the level of discounts rebounded later in the year.

China continued to be the largest buyer of Russian fossil fuels in July, accounting for 43 per cent of Russia’s monthly export earnings from the top five importers, a report by the Centre for Research on Energy and Clean Air (CREA) had pointed out last week.
Source: The Business Standard