Oil imports from Russia touch 13-month high – Commodities News
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India’s crude oil imports from Russia zoomed to a 13-month high in June even as the discounts on Russian crude have narrowed, according to an analysis of data provided by intelligence firm Kpler. The significant increase in Russia’s share in India’s oil imports can also be attributed to the resumption of imports of more grades of of the commodity other than Urals, including Sokol, which faced some issues in the beginning of the year.
The country imported 2.13 million barrels of crude oil
The share of US crude in India
“India’s imports of Urals have reached an all-time high, never on record did Indian refiners buy more than 1.6 million b/d. India has resumed purchases of Russian grades from the Far East such as ESPO or Sokol, however the quantities thereof are lower than they were on average in 2023,” said Viktor Katona, lead crude analyst at Kpler.
June imports from Saudi Arabia came in at a mere 430,000 barrels per day, the lowest monthly figure since January 2014. Katona noted that even in Covid times, India imported more and the main consequence thereof has been the cost of purchasing Saudi barrels.
“If Russian Urals cost around -$3 to -$4 per barrel to Dubai, medium sour grades from Saudi Arabia would be lifted at a premium of roughly $3 per barrel above Dubai. So there’s a wide $6-$7 per barrel difference between the two, still,” he said.
As a consequence, Saudi Arabia’s market
Cumulatively, the country imported 4.74 million barrels per day of crude oil in June, marginally up from 4.67 million barrels per day imported in June 2023.
Among Indian refiners, Reliance
Reports have earlier suggested that the country’s state-owned refiners are in discussions with Russia to secure a term deal for crude supplies on a fixed discount after the conclusion of a similar deal between Russia and Reliance Industries.
However, it seems that Russian exporters are not willing to go any lower than a $3 per barrel discount for Urals and that IOC
“The Russians have plentiful arguments they can use. First and foremost, in accordance with OPEC+ commitments, they’re cutting production by another 471,000 barrels per day compared to February,” he said. “Because of a longer-than-expected winter, most of the production cuts are only happening in May-June, meaning the volumes available into the summer months will shrink. Moreover, Russian refineries will ramp up their runs into July-August, shrinking available crude volumes even further.”