Indian state-owned oil refineries have once again ramped up imports of Russian Urals oil, despite tightening US tariff policies and increasing international criticism. In particular, Indian Oil Corp. and Bharat Petroleum have ordered new batches of oil from Russia for delivery in September and October of this year.
This is reported by Business • Media
Increase in Urals Discount Stimulates India’s Return to Purchases
The main reason for the resumption of purchases was the favorable pricing policy: the discount on Urals reached $2.5 per barrel in August compared to benchmark Brent crude, while in July it was only $1. This trend provided Indian refiners with an additional financial incentive to buy Russian crude.
In July, oil imports from the Russian Federation to India decreased by 24.5% compared to June, amounting to about 1.5 million barrels per day. At the same time, Russia remained the leading supplier of oil to India, accounting for 34% of total imports, surpassing Iraq and Saudi Arabia.
Political and Economic Motives for India’s Cooperation with Russia and China
In early August, Indian refineries temporarily suspended the signing of new contracts for the supply of Russian oil due to demands from US President Donald Trump to reduce imports, and the Indian government urged companies to develop alternative plans for fuel supply. However, officials in the country now state that decisions are made based on market feasibility and the protection of national interests.
“India states that it acts according to market logic and national interests.”
At the same time, India is expanding its political and economic cooperation with Moscow and Beijing. Prime Minister Narendra Modi announced his first visit to China in seven years, where he plans to meet with Chinese President Xi Jinping. The countries also agreed to resume direct flights and strengthen trade and investment ties. In turn, the President of Russia plans to meet with Modi in New Delhi by the end of 2025. Additionally, the Russian government promised India to increase mutual trade and provide support in countering US tariff pressure in exchange for further oil imports.