India increased crude oil purchases from Russia in June and maintained near-record imports from the UAE as refiners moved to secure supplies while awaiting a full recovery in Gulf exports following the reopening of the Strait of Hormuz, PTI reported citing data from maritime and commodity intelligence firm Kpler.India imported an average of 2.66 million barrels per day (bpd) of crude oil from Russia in the year to June 19, up from 1.91 million bpd in May, cementing Moscow’s position as the country’s biggest oil supplier.Imports from the UAE during the period stood at 636,000 bpd, slightly lower than the record 644,000 bpd imported in May. Venezuela emerged as India’s fourth largest crude oil supplier with shipments of 209,000 bpd, after Saudi Arabia’s 384,000 bpd.Imports from the United States fell sharply to 91,000 bpd from 252,000 bpd in May, according to Kpler data.The purchases underline India’s diversification strategy, with discounted Russian barrels continuing to attract refiners, while UAE supplies have helped ease uncertainty around shipments through the Strait of Hormuz.
Improvement continues, but risks still remain
India, the world’s third-largest energy importer, depends heavily on the Gulf region for crude oil, LNG and LPG supplies.The disruption began when Iran closed the Strait of Hormuz following US and Israeli attacks, blocking a strategic route that carries about 20% of global oil consumption and serves as a key export channel for producers such as Saudi Arabia, Iraq, Kuwait, the United Arab Emirates and Qatar.Oil shipments through the strait began to recover late last week after the US and Iran agreed to a ceasefire. However, Iranian officials have accused Israel of violating the agreement, and have raised questions about the sustainability of the reopening.The reopening is expected to provide relief to India’s energy imports, although the pace of recovery will vary by fuel, according to Sumit Ritolia, senior manager-modeling at Kepler.“The reopening of the Strait of Hormuz (SOH) will mark a major milestone for global energy markets, but its impact on India is likely to vary significantly across commodities,” he said.“Although India remains one of the largest importers of Middle Eastern hydrocarbons (crude oil, LPG and LNG), crude oil and LNG imports have proven relatively resilient throughout the disruption, unlike LPG, which has been most severely affected.”
LPG likely to recover first
Ritolia said LPG supplies are likely to normalize faster than crude oil and LNG imports as India has already adapted to months of disruption through alternative sourcing and supply routes.“As a result, the recovery is likely to be gradual, with LPG flows normalizing first, followed by LNG and crude oil. Under our base case of gradual reopening from early July, the initial focus will be on clearing stranded cargo and restoring shipping flows before Gulf exporters increase exports,” he said.India imports about 88% of its crude oil requirements, about half of its natural gas requirements and about 65% of its LPG consumption. Before the conflict, the Gulf region supplied about half of the country’s crude oil imports, two-thirds of its LNG requirements and about 90% of its LPG imports.Recent signs of normalcy have already emerged. Three Indian-flagged oil tankers and one Indian LNG carrier carrying more than 860,000 tonnes of crude oil have resumed transit through the strategic waterway following the US-Iran deal.
Russian crude remains central to strategy
Ritolia said Russian crude remains the cornerstone of India’s oil import strategy, with imports in June expected to exceed 2.35 million bpd and potentially set a record, supported by competitive discounts and stable refinery demand.He expects Russian supplies to remain the cornerstone of India’s import basket even after the normalization of Hormuz due to favorable economics and supply security considerations.Indian refiners have also increased purchases from Venezuela and the Atlantic basin since March to compensate for short supply in the Gulf. Venezuelan imports are estimated at 300,000-400,000 bpd in June, providing an additional diversification option for refiners processing heavier grades despite sanctions-related risks.According to Ritolia, Gulf suppliers are likely to gradually gain market share once Hormuz normalizes, although India’s sourcing mix is expected to remain broader than before the crisis.He said reopening Hormuz would help reduce freight costs, supply risks and lower energy prices globally, although a full return to pre-crisis trade patterns could take weeks or months as shipping companies, insurers and traders rebuild confidence in the route.
