India’s Russian oil fix isn’t going anywhere. Even as Washington rolls out new sanctions, India is poised to keep Russian crude flowing, “just through less transparent routes”, analysts say.
November saw imports surge to a five-month high before a sanctions-driven dip set in, but that slowdown is likely to be only “temporary” as Moscow scrambles to reroute barrels and Indian refiners seek out compliant, non-sanctioned suppliers, says Sumit Ritolia, lead research analyst at global commodity analytics firm Kpler.
“India will continue to buy from non-sanctioned suppliers of Russian oil,” Ritolia says, noting that Indian political leaders “will not want to be seen as bending down to US sanctions”.
Russian barrels remain “highly cost-competitive, and workarounds to maintain flows are likely to emerge”, he adds.
The latest US sanctions, which went into effect on 21 November, are tightening the screws on Russia’s shadow fleet and sanctioned traders, squeezing routes and cracking down on vessels able to transport Kremlin crude.
Last month’s climb in imports, averaging around 1.9-2.0 million barrels per day (mbpd), more than a third of India’s total crude intake, was driven by massive front-loading as refiners raced to bring in cargoes before the 21 November sanctions deadline.
Since then, flows have started to unwind sharply. With loadings now thinning, December arrivals are expected to fall to roughly half November’s level.
“Looking ahead, we’ve started to see a clear dip in Russia’s exports to India,” says Ritolia. “Based on current loadings and voyage activity, we expect December arrivals to be in the range of 1.0–1.2 million barrels per day (mbpd). Russian flows could ease towards around 800 kbd (thousand barrels per day) before stabilising,” he adds.
Several domestic factors also contributed to the November spike. Demand for transport fuels has remained strong, making discounted Russian grades even more attractive. Meanwhile, Nayara Energy, whose ownership links to Russian state-owned giant Rosneft make it structurally more reliant on Russian crude, saw a sharp pick-up, running almost entirely on Russian grades.
Washington’s newest penalties are part of its effort to enforce the G7 oil price cap, which aims to limit Russia’s revenue to fund its war in Ukraine without disrupting global supply. The US is increasingly targeting ships suspected of evading the price cap, intermediaries that conceal true ownership, and Russian-linked traders using falsified documents.
On the Russian side, the response to the US sanctions has “been highly adaptive”, says Ritolia, citing “ship-to-ship transfers near Mumbai, mid-voyage diversions, and more complex logistics to keep barrels moving and increase discounts”.
Unless the US rolls out sweeping “secondary” sanctions, “India is likely to continue importing Russian crude, just through more indirect and less transparent routes”, he adds. “In particular, buyers may increasingly pivot to non-sanctioned Russian entities and opaque trading channels.”
Indian refiners also emphasise that Russian oil itself is not sanctioned. As long as sellers and shippers remain compliant, they argue, purchases can continue. “Current discounts are still attractive, which also supports ongoing demand,” Ritolia says.
To compensate for lower Russian shipments in the near term, Indian refiners are expected to increase purchases from a broader mix of suppliers, including Saudi Arabia, Iraq, the UAE, Brazil, Argentina, Colombia, West Africa, and the US and Canada.