Saudi crude imports hit record high in February as India pares Russian purchases
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Russia’s share of India’s imports declined to 20% in February from 23% the previous month. Saudi Arabia’s rose to 19.6% from 15% in January
- India’s Saudi oil imports hit record 1.05 million bpd in February
- Russian oil imports to India fell 10 percent month-on-month
- India prepares contingency plans amid Gulf supply risks
India’s crude imports from Saudi Arabia hit a record high in February at 1.05 million barrels a day, as New Delhi pared Russian purchases, data from analytics firm Kpler shows.
The growing share of Gulf-origin crude in India’s imports can have a bearing on prices and energy security, as the widening US-Iran conflict disrupts supplies through the Strait of Hormuz.
While Russia remained the largest supplier of crude with 1.07 million bpd, volumes were nearly 40 percent lower than the record 1.8 million bpd in November and 10 percent down from the previous month.
In the last two to three months, India’s dependence on West Asian Eastern barrels has grown, as refiners sought to move away after the US sanctioned Russian oil majors Rosneft and Lukoil. While announcing the India-US trade deal in early February, US President Donald Trump said India had agreed to stop buying Russian oil.
The country’s crude imports stood at 5.3 million bpd in February, a tad higher than 5.2 million bpd in the previous month.
Russia’s share in India’s imports declined to 20 percent in February from 23 percent in the previous month, Kpler data shows.
Saudi Arabia accounted for 19.6 percent of oil imports, up from 15 percent in January.
Traditionally, Saudi Arabia has been India’s top supplier until the 2022 Russia-Ukraine war led to a shift. Russia emerged as the top exporter, offering heavy discounts on its Urals grade.
“As a result, the relative weight of Gulf-origin crude in India’s import basket has risen, increasing short-term sensitivity to any disruption in Hormuz transit,” said Sumit Ritolia, lead research analyst, refining and modelling at Kpler.
Imports from the United Arab Emirates (UAE) also increased by 42 percent to 561,000 bpd against 395,000 bpd in January.
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Russia back in the mix
Analysts believe that Indian refiners are expected to go back to Russian oil, as access to the West Asian grades tightens amid the US-Iran conflict and Tehran’s warning of hitting ships passing through the Strait of Hormuz
A disruption of the strait will affect 50 percent of India’s total oil imports and almost all of its LPG purchases, analysts say.
According to Kpler’s estimates, roughly 2.5-2.7 million bpd of India’s crude imports transit Hormuz, largely from Iraq, Saudi Arabia, the UAE, and Kuwait.
The strait runs between the Persian Gulf and the Gulf of Oman and is the only sea passage from the Persian Gulf to the open ocean.
Kpler tracking indicates continued availability of Russian cargoes in the Indian Ocean and Arabian Sea region, including volumes in floating storage.
“Should Middle Eastern inflows tighten, Indian refiners could pivot back toward Russian grades relatively quickly,” Ritolia said.
On March 2, Saudi Arabia shut down its biggest domestic oil refinery after a drone strike, reports said. Saudi Aramco’s 550,000 bpd Ras Tanura refinery, which was shut as a precautionary measure, is part of an energy complex on the kingdom’s Gulf coast.
India is also putting in place a contingency plan, which includes exploring new routes and increased intake of Russian barrels, to secure crude supply, sources have told Moneycontrol.
On March 2, Saudi Arabia shut down its biggest domestic oil refinery after a drone strike, reports said. Saudi Aramco’s 550,000 bpd Ras Tanura refinery, which was shut as a precautionary measure, is part of an energy complex on the kingdom’s Gulf coast.
India is also putting in place a contingency plan, which includes exploring new routes and increased intake of Russian barrels, to secure crude supply, sources have told Moneycontrol.
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