New Delhi: As the US-Iran agreement opens the door for Iranian crude oil to return to global markets after years of sanctions, Russian oil import to India is set to hit a record high in June. At the same time, Venezuelan barrels are emerging as an increasingly important diversification option for Indian refiners.
Data provided by global analytics firm Kpler to ThePrint shows India imported around 2.7 million barrels per day (mbpd) of Russian crude from 1 June to 18 June. While the Russian barrels are expected to moderate in the remaining days of the month, imports are still projected to average more than 2.25 mbpd during June, an all-time high for any month.“India’s imports of Russian barrels remained strong through June, supported by continued discounts and steady refinery demand,” Sumit Ritolia, manager for oil markets at Kpler, told ThePrint. “While barrels will likely average out, June imports are expected to reach an all-time high, exceeding 2.25 mbpd.”
The strong inflows come despite uncertainty over US waiver, which enabled India to purchase Russian crude stranded at sea. This waiver expired on 17 June and has not yet been renewed.“Regardless of whether the US waiver is extended, we expect India’s imports of Russian crude to remain robust, even if not at record-high levels,” Ritolia said.According to Ritolia, Russian crude continues to remain competitive against global benchmarks and is likely to retain its dominant position in India’s import basket despite the easing of sanctions on Iran.“Russian barrels will remain a key component of India’s import basket because of its suitability to Indian refineries and its pricing advantage. In the end, economics will drive procurement decisions,” Prashant Vasisht, senior vice president and co-group head, corporate rating at Investment Information and Credit Rating Agency, told ThePrint.He added, “However, if US sanctions remain in place, refiners may increasingly turn to non-sanctioned barrels that would then be available at attractive discounts.”Shruti Naithani | ThePrint
