India Buys Record Russian Oil in July

India’s imports of Russian crude oil hit a new high in July, with the country buying 2.8 million barrels per day. This is up from the previous high of 2.7 million barrels per day in June, according to vessel-tracking data by Kpler.

The data shows that total Indian crude oil imports stood at just over 5 million barrels per day in July, with Russian oil accounting for 55.5% of the total.

Indian refiners continued to rely on Russian volumes amid threats to shipping in the Strait of Hormuz and the Bab el-Mandeb Strait in the Red Sea. The share of Russian oil in India’s overall crude imports was the highest ever recorded.

Apart from record Russian volumes, Indian refiners also boosted imports of crude from Saudi Arabia and Iraq. Millions of barrels managed to make it out of the Persian Gulf during the mid-June-mid-July window when the Strait of Hormuz was tentatively open to tanker traffic, affecting oil reroutes and security.

India also imported crude from Kuwait for the first time since March, according to the shipping data compiled by Kpler. The United Arab Emirates remained India’s second-largest crude oil supplier, behind Russia, as the UAE is raising production and shipments of crude loaded on tankers outside the Strait of Hormuz.

The fact that India continued to import high levels of Russian crude in July, even after the end of the U.S. waiver the previous month, highlights the country’s dependence on Russian oil. The U.S. had quietly let the waiver allowing the purchase of Russian oil loaded on tankers expire on June 17.

Going forward, Russian crude will remain a key source of oil supply for India amid the highly uncertain shipping conditions in the Strait of Hormuz and the Bab el-Mandeb Strait. This is because Indian refiners have limited options for replacing Russian crude, given the geopolitical tensions in the region.

India’s energy needs are a significant factor in its economic growth.

The country’s reliance on imported oil makes it vulnerable to price fluctuations and supply disruptions. As such, the country’s decision to continue importing Russian crude, despite the challenges, is likely driven by its need to ensure a stable energy supply. India must balance its energy security with geopolitical considerations to meet its energy needs.

According to the report, India will likely continue to rely on Russian crude in the coming months, due to the complex relationships between energy security, geopolitics, and economic growth.