New Delhi, 30 December (HS): India’s imports of Russian crude oil are expected to register a sharp decline in December, but the drop reflects short-term supply disruptions rather than a fundamental shift in sourcing patterns, according to industry data.

Real-time data analytics firm Kpler estimates that Russian crude imports into India will fall to around 1.2 million barrels per day in December, down from about 1.84 million barrels per day in November, marking the lowest level since December 2022. Indian refiners, however, continue to procure Russian crude from non-sanctioned entities.

The decline has been attributed to disruptions following recent US sanctions on major Russian oil exporters Rosneft and Lukoil, as well as the impact of European Union sanctions on Russian-linked product flows. Analysts had flagged the possibility of such a drop as early as October.

India, the world’s third-largest oil importer, significantly increased purchases of discounted Russian crude after Western nations curtailed imports following the February 2022 conflict in Ukraine. Russia subsequently emerged as India’s largest crude supplier, with its share rising from less than one per cent to nearly 40 per cent of total imports at its peak. In December, Russia remained the top supplier, though its share fell to below a quarter from about one-third in November.

Following US sanctions that came into effect on November 21, several refiners temporarily scaled back or halted imports from Rosneft and Lukoil-linked entities. During the month, refiners increased sourcing from alternative suppliers in the Middle East, West Africa and the Americas, while also relying on non-designated Russian producers and intermediary trading channels.

Industry analysts said Russian crude flows into India are expected to recover gradually from January as new intermediaries step in and supply chains stabilise. Discounts on Russian Urals crude have also adjusted, reflecting both sanctions-related changes and broader weakness in the Asian medium sour crude market.

Despite the December decline, analysts said Russian crude is likely to remain a part of India’s import mix due to pricing advantages, refinery compatibility and limited near-term alternatives, provided no broader secondary sanctions are enforced.

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Hindusthan Samachar / Jun Sarkar