India and China, two of the world’s major oil importers, are competing for scarce global crude supplies as disruptions in the Strait of Hormuz and stalled peace talks between the U.S. and Iran tighten the market.
The two economic powerhouses are now locked in a fierce scramble over limited available supplies, mainly from Russia and, to a lesser extent, Saudi Arabia.
“The competition for Russian crude between India and China has been intense and will continue to be so for June-loading cargoes,” Muyu Xu, a senior analyst at Kpler, told CNBC.
On April 18, the U.S. renewed a waiver allowing countries to buy sanctioned Russian oil at sea for about a month, easing pressure on global prices. However, it did not ease sanctions on Iranian crude, of which almost 98% is bound for China, with smaller volumes reaching India.
Iranian attacks on energy infrastructure in the Middle East have also disrupted oil supplies from Gulf countries, increasing demand for Russian oil.
