Oil imports from US at 4.5-yr high in Oct: Russian supply also stays strong

India's crude oil imports from the US rose to the highest level in October since March 2021 as refiners bought 593 thousand bpd of crude oil from Washington

India’s monthly crude oil imports from the US climbed in October to their highest level since March 2021, even as purchases of Russian oil stayed robust at 1.61 million barrels per day (bpd) but slightly below the year-to-date average of 1.73 million bpd, according to data from maritime intelligence firm Kpler.

 

Indian refiners imported 593,000 bpd of crude oil from the US in October, a sharp rise from 207,000 bpd in September and well above the year-to-date average of 305,000 bpd. The growing share of US oil in India’s crude basket underlines deepening energy ties between the two nations and reflects New Delhi’s strategy to balance supply security, economics, and geopolitics.

 

“The increase was economics-led, supported by a strong arbitrage window, a wider Brent-WTI spread, and weak Chinese demand that made WTI Midland competitive on a delivered basis,” said Sumit Ritolia, lead research analyst for refining and modelling at Kpler. “That said, further upside is limited, as the rise is arbitrage-led, not structural, constrained by longer voyage times, higher freight costs, and WTI’s lighter, naphtha-rich yield.”

 

Imports of Russian oil in October were marginally higher than in September, when Indian refiners bought 1.57 million bpd.

October’s crude import data may not yet fully reflect India’s purchasing strategy following the latest round of US sanctions on major Russian oil firms. Cargoes arriving from Russia in October would have been booked between mid-August and September, given freight times of 30 to 45 days.

 

Effective November 21, US President Donald Trump sanctioned two Russian oil companies, Rosneft and Lukoil, in an effort to curb Moscow’s financial capacity and end the war in Ukraine. The two companies supply around 60-70 per cent of India’s Russian crude imports.

 

“Following the sanctions, we observed accelerated Russian crude arrivals ahead of the deadline, with no refiner except Nayara expected to import from sanctioned suppliers thereafter,” Ritolia said. “Russian crude flows are likely to remain around 1.6-1.8 million bpd until November 21, before tapering as refiners avoid potential OFAC (office of foreign assets control)-related exposure.” 

He added that imports of Russian crude in December and January were expected to decline notably as refiners assess the impact of sanctions and rebuild supply chains.

 

India’s state-run refiners typically buy Russian crude on the spot market through intermediaries, insulating them from direct exposure to sanctions. Private oil major Reliance Industries (RIL) has a term deal with Rosneft for 500,000 bpd, while Nayara Energy is 49 per cent owned by the Russian company.

 

Indian refiners are expected to continue sourcing Russian grades through non-sanctioned intermediaries. State-run Indian Oil Corporation (IOCL) has said it will comply with sanctions but not stop buying Russian oil altogether. “If somebody comes to me (with Russian oil) which is a non-sanctioned entity, and the cap is being complied with, the shipping is okay, then I will continue to buy it,” said Anuj Jain, director of finance at IOCL, during a post-earnings investor call last week.

 

India’s crude imports from its traditional West Asian suppliers also remained strong in October. Iraq and Saudi Arabia supplied 826,000 bpd and 669,000 bpd respectively, while the UAE provided 363,000 bpd.