India’s crude oil imports fell by 5 per cent M-o-M to 4.35 million barrels per day (mb/d) during August, which is the lowest in volume terms so far in the current financial year.

The decline in imports was largely led by contracting cargoes from Russia, which is at its lowest levels since January 2023, according to data from the energy intelligence firm Vortexa.

The decline during August was due to narrowing discounts on the Urals grade and smaller appetite from Indian refiners due to planned autumn maintenance at some refineries, and lower domestic demand on account of the rainy season till September.

Urals shipments from Russia to India in August slipped to its lowest levels since January this year at 1.08 mb/d after an all- time high import of around 1.6 mb/d in July of the medium sour grade, which was higher by 18 per cent compared to June and 14 per cent higher than the previous record in May 2023.

Indian refiners, particularly state-run oil marketing companies (OMCs) topped up on Ural, Russia’s flagship export grade, in anticipation of decline in supply of the medium sour grade. Imports of Ural hit a new high in July bolstered by expected supply disruptions in August and September as Russia limited exports to shore up prices and meet domestic demand.

Import dynamics

Overall, the PSU refiners, led by Indian Oil Corporation, cumulatively imported 852,000 barrels per day (b/d) followed by 617,000 b/d by private refiners Reliance Industries (RIL) and Nayara Energy.

In terms of grade, the in-bound shipments of Urals stood at 1.08 mb/d followed by ESPO blend at 173,000 b/d, Sokol (Sakhlin I) at 113,000 b/d and Varandey at 103,000 b/d.

Vortexa’s Head of APAC Analysis, Serena Huang told businessline that from an import perspective, India received 1.469 mb/d of Russian crude in August.

Iraq maintained its position as India’s second largest supplier at 866,000 b/d followed by Saudi Arabia at 820,000 b/d was again the third largest supplier. It was followed by the UAE at 273,000 b/d, the US (160,000 b/d) and Kuwait at 153,000 b/d during August.

Plateauing Russian imports

The Organization of the Petroleum Exporting Countries (OPEC) in its latest monthly oil market report had said that imports from Russia may have topped out in May.

“Looking ahead, India’s crude imports from Russia potentially topped out in May, declining in June and July. Total crude inflows in July are seen lower with the start of refinery turnarounds,” OPEC said in its monthly oil market report.

India’s crude imports declined M-o-M for the fourth month in a row to an average of 4.68 mb/d in June 2023 (April: 4.89 mb/d and May 4.84 mb/d), as the country moved into the lower demand monsoon season, the report pointed out.

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