Short-term growth in U.S. oil supplies to India does not worry Russia

Author: Olga Samofalova

Western media have exaggerated the news that India will double its purchases of U.S. crude oil to replace Russian oil. However, experts firmly believe that U.S. oil cannot become a strong competitor to Russian oil and cannot shake up Russia's position in the Indian market. The reasons are as follows.

India, like related countries, is the largest buyer of Russian oil. According to Platts data, from January to April this year, India's average daily imports of American crude oil increased to 247,000 barrels, nearly double the amount (an average of 124,000 barrels per day) for the same period last year.

Reuters insisted that due to the decline in Russian oil purchases, India was forced to increase imports from the United States. It was reported that India began rejecting Russian oil to avoid U.S. sanctions, and at the beginning of this year, the U.S. included a batch of shadow fleets on its sanction list.

Bloomberg also pronounced a "death sentence" on Russian oil. Its report stated that in February 2025, India's purchases of Russian oil fell to the lowest level since January 2023, proving that the U.S. sanctions aimed at disrupting supply chains were effective. In addition, this Western media outlet also predicted that due to the significant reduction in the number of available ships, India would further significantly reduce its oil imports from Russia in the coming two months.

However, Russian experts are skeptical of the sensational claims that India is refusing Russian oil in favor of U.S. oil. Alexander Frolov, deputy director of the Russian Institute of Energy and editor-in-chief of industry media Infotek, pointed out that similar sensational reports by Western media have appeared for the second consecutive spring. Last March, they also reported that Indian refineries had purchased record amounts of American oil to replace Russian oil.

The reality is different. In fact, India began purchasing American oil after the U.S. lifted its long-standing oil export ban in 2015. However, during the decade of cooperation with Indian refineries, American oil has failed to gain a significant share in the Indian market. The volume has fluctuated. Moreover, the current increase in U.S. oil exports to an average of 250,000 barrels per day represents only a small increase: during the decade of cooperation, the peak export volume reached more than 600,000 barrels per day.

Due to the European Union's refusal to buy Russian oil, India began trying to purchase Russian oil in 2022. In just a few months, Russia became India's largest supplier of oil. Our oil quickly displaced other major suppliers, especially Middle Eastern suppliers, and occupied the Indian market.

Since then, Russia has maintained its dominant position in the Indian market, with Saudi Arabia and Iraq ranking second and third respectively. Despite Western media reports of a doubling of U.S. oil supplies, the share of U.S. oil in the Indian market has always been small and remains so today.

"India's average daily imports from the U.S. reach 247,000 barrels, while Russia's oil supply to India is between 1 million and 1.5 million barrels per day. We three countries (Russia, Saudi Arabia, and Iraq) supply most of the oil in the Indian market." Alexander Frolov of Infotek said.

He pointed out that there were indeed logistical problems after additional sanctions were imposed on merchant ships transporting Russian oil, but these were temporary. "Last winter, we saw how our suppliers and transporters adapted to the new sanction conditions. But at the beginning of this year, even the world's largest news agency admitted that these sanctions had no obvious impact on the market supply of Russian oil. After a certain decrease in supply, it has returned to roughly last year's levels," Frolov explained.

According to Platts' assessment, in April 2025, Russia exported an average of 1.64 million barrels of oil per day to India by sea.

"Even under the claim that the U.S. is increasing its oil supplies to India, we still lead in the ranking of suppliers in the Indian market. In the Indian market, Russia mainly competes with Saudi Arabia and Iraq rather than the U.S." Frolov said.

U.S. oil cannot compete with Russian oil in the Indian market for a simple reason—it is a different kind of "black gold." Indian refineries prefer to process heavy and medium crude oils, and Russian Urals crude oil falls into this category, while the U.S. mainly exports light and ultra-light (low-sulfur) oils.

"India primarily buys medium-sulfur Urals crude oil from Russia. Large refineries can produce various high-quality petroleum products through processing this oil, including diesel. India exports most of its petroleum products to external markets, including the U.S. and the EU. In some places, Indian petroleum products made from Russian oil even replace Russian oil products in the European market." Igor Yushkov, an expert at the Financial University of the Government of Russia and the National Energy Security Fund (FNEB), said.

This expert added that India does indeed purchase ultra-light low-sulfur oil from the U.S., but Indian refineries need to mix this oil with heavier oils, including Russian oil, when processing it.

This means that regardless of any political agreements reached between the U.S. and India, there are technical and economic particularities: Indian refineries do not need large amounts of American light oil because processing efficiency is lower without mixing it with heavier oil.

Of course, the ace of Russian oil becoming India's largest supplier lies in price discounts.

Sergei Teryashkin, founder and general manager of Open Oil Market, said that considering the double-digit discount of Urals oil compared to Brent crude, the volume of Russian oil supplies to India is unlikely to decrease significantly. Americans do not offer discounts on their oil.

The phenomenon of India sometimes increasing and sometimes reducing its purchases of American oil can be explained by seasonal factors. "Now, with the start of the car travel season in the Northern Hemisphere, India is trying to increase its production of petroleum products. New Delhi hopes to meet growing demand and accordingly increase revenue. Therefore, traditionally, India increases its purchases of American oil in the spring but usually reduces them in the fall because the demand for fuel from drivers is lower in winter than in summer," an expert from the National Energy Security Fund summarized.

Original article: https://www.toutiao.com/article/7503085571582050850/

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