India Boosts Russian Oil Purchases to €2.6 Billion Despite U.S. Sanctions on Moscow’s Producers

India's imports of oil from Russia have shown an increase of 4% in November and reached a five-month high of 2.6 billion euros. All this data was made available by an Europe-based research organization named Center for Research on Energy and Clean Air (CREA). As per the given report, a major share of oil imports from Russia is being further shipped as refined products to different nations like Australia.

According to it, India continues to be the second-largest buyer of Russian fossil fuel imports in November, after China. It had paid 2.5 billion euros for buying Russian oil in October. China accounted for 47 percent of Russia’s export of crude oil, followed by India at 38 percent, with 6 percent shared by Turkey and Europe.

It said that India's purchases may actually increase further in December, as shipments loaded before the US Office of Foreign Assets Control (OFAC) sanctions came into effect will be delivered throughout the month. On October 22, the US imposed sanctions on Russia's two largest oil producers, Rosneft and Lukoil.

Due to the sanctions, companies like Reliance Industries, Hindustan Petroleum Corporation Limited (HPCL), HPCL-Mittal Energy Limited, and Mangalore Refinery and Petrochemicals Limited have temporarily halted imports. However, other refineries like Indian Oil Corporation (IOC) continue to purchase oil from the sanctioned Russian companies.

While imports from private refineries declined marginally, state-owned refineries increased Russian crude oil volumes by 22 percent month-on-month in November, CREA said.

India, the world's third-largest oil importer, emerged as the largest buyer of discounted Russian crude oil after Western countries distanced themselves from Moscow following Russia's invasion of Ukraine in February 2022. Traditionally dependent on West Asian oil, India could dramatically increase Russian imports due to the availability of oil at heavily discounted prices due to sanctions and a decline in European demand. This has increased its share of total crude oil imports from less than 1 percent to nearly 40 percent.

CREA stated that in November, six refineries located in India and Turkey exported refined oil products partially produced from Russian crude oil worth 807 million euros to the European Union (465 million euros), the United States (110 million euros), the United Kingdom (51 million euros), Australia (150 million euros), and Canada (31 million euros). Of these products, an estimated 301 million euros worth of products were refined from Russian crude oil. It stated that the destination of an estimated 297 million euros worth of oil products exported by these refineries has not yet been determined.

Refineries' exports to sanctioned countries decreased by 8 percent month-on-month. In contrast, exports to Australia (150 million euros) increased by 69 percent in November. All of these consignments originated from India's Jamnagar refinery.