India surpassed China to become the largest buyer of Russian oil, in July

In July, India surpassed China as the world’s largest importer of Russian oil, according to a comparison of import data cited by Reuters. This shift occurred as Chinese refineries bought less Russian oil due to lower profit margins in fuel production.

Russian crude oil accounted for a record 44% of India’s total imports last month, reaching a historic high of 2.07 million barrels per day (bpd), 4.2% more than in June and 12% more than the same month last year, according to Indian trade transport data and industry sources.

This figure exceeded China’s July imports of Russian oil, which were 1.76 million bpd, through pipelines and transport, based on Chinese customs data.

Indian refineries have been purchasing discounted Russian oil after Western nations imposed sanctions on Moscow and reduced their energy purchases in response to Russia’s invasion of Ukraine.

“India’s demand for Russian oil will increase as long as sanctions are not tightened further,” said an Indian refining source.

India’s trade with Russia has increased since Russia began its war against Ukraine in February 2022, mainly due to imports of oil and fertilizers, a move that helps control global prices and inflation.

India’s rising purchases are shifting the flow of Russian ESPO Blend crude oil from traditional Chinese buyers to South Asia. Imports of ESPO to India increased to 188,000 bpd in July, as larger Suezmax vessels were used.

Northeastern Chinese refineries, typically the largest buyers of ESPO due to their proximity, have reduced their purchases due to lower fuel demand.

Iraq continued to be India’s second-largest oil supplier last month, followed by Saudi Arabia and the United Arab Emirates.

Indian purchases of Middle Eastern oil increased by 4% in July, raising the region’s share of India’s overall import mix to 40%, up from 38% in June, according to the data.