India’s rising imports of Russian crude oil are being driven more by supply disruptions in West Asia than by cheap prices, according to an Axis Bank Economic Research report released on Tuesday.
Since the start of the US-Iran war, India has imported about 298 million barrels of Russian crude. Monthly imports have averaged around 60 million barrels, compared with 46 million barrels a month during FY23-26.
Russia’s share of India’s crude imports had earlier jumped from almost zero in March 2022 to around 30 per cent by June 2023, mainly as discounts made Russian oil attractive.
However, the latest rise cannot be explained by discounts alone. The report said the average discount on Russian crude compared with West Asian oil has stayed around $3-$5 per barrel since 2023. Russia’s share also increased even when its crude carried premiums of up to $7 per barrel.
The report said West Asia’s supply disruptions have pushed India to rely more on Russian crude. It also noted that buying the extra oil from the spot market could have pushed global oil prices higher.
