Russia's oil exports to India sink to three-year low amid U.S. sanctions pressure

Bloomberg reported the information.

Deliveries are projected to average approximately 1.1 million barrels per day in December, marking the weakest flow since November 2022, according to shipping analytics firm Kpler. The decline represents a significant drop from the 1.8 million barrels daily recorded in November, though current projections still exceed earlier estimates from Indian government officials who had anticipated flows would fall to just 800,000 barrels per day following Washington's latest crackdown on Russian energy exports.

India's appetite for discounted Russian crude has fluctuated in recent months as refiners confronted intensifying U.S. oversight of the trade. Shipments initially declined in July before recovering modestly as state-owned processors Indian Oil Corp. and Bharat Petroleum Corp. resumed purchases of the competitively priced oil.

The December downturn was driven largely by Reliance Industries Ltd., India's largest private refiner, which temporarily halted Russian oil purchases after the U.S. Treasury Department sanctioned major producers Rosneft PJSC and Lukoil PJSC in late October. The sanctions gave importers a one-month window to conclude existing transactions with the two blacklisted companies.

Reliance has now resumed sourcing Russian crude from suppliers not subject to sanctions, directing these barrels to its massive Jamnagar refinery complex in Gujarat, which processes fuel for India's domestic market rather than for export purposes.

Kpler data shows Russian crude deliveries to India plummeted to just 712,000 barrels daily during the second week of December before beginning to climb again. The December slump also reflects reduced volumes to the HPCL-Mittal Energy Ltd. terminal at Mundra, while Mangalore Refinery and Petrochemicals Ltd. took no Russian barrels this month—the first such pause since September 2022.

Looking ahead, Indian imports could receive additional support from Nayara Energy Ltd., a Rosneft-backed processor that faces European sanctions. The company is reportedly considering postponing scheduled maintenance at its Vadinar refinery, originally planned for early next year, a move that could sustain higher Russian oil purchases in the coming months.