Indian refiners come to the rescue of Russia’s oil exporters

India’s refiners are coming to the aid of Russia’s oil exporters, with record amounts of their crude being delivered to the south Asian nation.
More than 2.3 million barrels a day of Moscow’s oil was offloaded at Indian ports last month, vessel-tracking data compiled by Bloomberg showed, with deliveries so far in July close to that level. That’s up from almost nothing before the Kremlin’s invasion of Ukraine more than four years ago, and is helping to keep a lid on cargoes of Russian oil mounting up at sea.

Exports from several of Russia's top producers are still subject to US sanctions, but that doesn’t appear to be deterring buyers. When the measures were introduced late last year, there was an expectation that flows would plunge. Instead, the use of middlemen has allowed shipments to soar.


The huge inflows have come amid the loss of supplies from the Persian Gulf and have been propelled by soaring Russian exports and tumbling prices.

Exports from the Middle East, the world’s most important producing region, have slumped again after briefly showing signs of recovery following an interim peace deal between the US and Iran. But the accord broke down within a month, leading to renewed Iranian attacks on ships crossing the Strait of Hormuz and the reimposition of a US naval blockade. Most recently, threats from Houthi rebels in Yemen to attack ships calling at Saudi ports have put at risk shipments from the kingdom’s Red Sea ports, which have become a vital alternative to flows from the gulf.

Four-week average seaborne crude shipments from Russia remain close to the all-time high seen in the first week of the month, even though they edged lower for a second week to 4.16 million barrels a day in the period to July 19, according to tanker-movements data compiled by Bloomberg.

Continued attacks by Ukraine on Russia’s refineries are likely diverting into exports some crude supplies that can’t be processed at home, driving up Russia’s overseas shipments even as oil production is falling. Kyiv’s drones struck the 300,000-barrel-a-day Yanos refinery in Yaroslavl, northeast of Moscow, last week.

A wave of attacks has pushed Russian refining runs to the lowest in more than 21 years so far in July, deepening a domestic fuel crunch and forcing Moscow to approve subsidies for imported fuels to ensure a stable supply to the domestic market.

Indian buyers may also have been encouraged by tumbling prices for Russian crude, which have fallen in each of the last 13 weeks on a four-week average basis and are now little more than half what they were at their peak in mid-April.

Back at the start of the year, the threat of US sanctions deterred some Indian refiners from buying Moscow’s crude and that hesitance could return, with a bipartisan group of US senators hopeful of bringing a Russia sanctions bill to the floor soon.

The bill would target the top five purchasers of Russian crude oil and natural gas, including India, with tariff rates up to 100%, but it remains to be seen whether President Donald Trump would impose the levies while the US and India are locked in trade talks.

Crude Shipments

In the week to July 19, some 37 tankers loaded 27.73 million barrels of Russian crude, vessel-tracking data and port-agent reports show. The volume compared with a slightly revised 27.51 million barrels on 36 ships the previous week.

On a daily average basis, shipments in the week to July 19 edged higher to 3.96 million barrels a day from a revised 3.93 million the previous week.

Year-to-date flows of 3.62 million barrels a day are up by 280,000 barrels a day from the average for the whole of last year and exceed the annual averages for each year since Moscow’s February 2022 invasion of Ukraine.

Weekly shipments can be volatile, affected by weather, maintenance work, sanctions and the timing of departures.

There was one shipment of Kazakhstan’s Kebco grade from Ust-Luga on the Baltic and two from Novorossiysk on the Black Sea during the week.

Russia’s soaring exports and cargoes that are taking longer to clear than previously have helped push the amount of Russian crude at sea up to about 137 million barrels by Sunday.

Five tankers full of Urals crude are anchored off Mersa El-Hamra on Egypt’s Mediterranean coast, the tracking data show. Another five have come to a halt in the Riau archipelago, east of Singapore, a gathering place for shadow fleet ships hauling sanctioned oil. Meanwhile, cargoes of Sokol and Sakhalin Blend crude from Russia’s far east may wait for weeks to be moved from shuttle tankers onto ocean-going ships. Some cargoes of flagship ESPO are also idling for weeks near the main Pacific port of Kozmino after loading.

Export Value

On a four-week average basis, the gross value of Moscow’s exports fell to $1.54 billion a week in the 28 days to July 19, down by $40 million a week from the revised figure for the period to July 12. The small drop in crude flows was compounded by slightly lower prices for Russia’s crudes, with the benchmark Urals grade now worth less than half what it was at its recent peak in mid-April, on the four-week average measure. Even so, the value of Moscow’s exports is still higher than it was at any time last year.

On this basis, the export prices of Russia’s Urals loaded in the Baltic were down by about $0.50 to $48.27 a barrel, while a $0.60 a barrel drop took Black Sea prices to $47.78 a barrel. The price of Pacific ESPO crude moved in the opposite direction, rising by $0.20 to average $63.69 a barrel. Delivered prices in India fell for a 13th week, down by $1.60 to $65.28 a barrel, a new low for the period since mid-March. All prices are based on daily numbers from Argus Media. Calculated prices for the four-week averages to July 12 have been revised for all grades.

On a weekly basis, the value of exports moved in the opposite direction, rising by about $200 million to $1.62 billion in the seven days to July 19, with higher prices boosting the impact of a small increase in flows.

Flows by Destination

Observed shipments to Russia’s Asian customers, including those showing no final destination, edged lower to 3.89 million barrels a day in the 28 days to July 19, down from a revised 3.95 million in the period to July 12.

While the amount of Russian crude on tankers showing destinations in India continues to show sharp declines in the most recent weeks, the volume on vessels yet to show a final destination has soared, allowing for much of that pattern to be reversed in time. Tankers frequently show interim destinations, such as Suez or Port Sudan, until they are well across the Arabian Sea, while some never show a final calling point, even after mooring to discharge.

Flows on tankers signaling Chinese ports stood at 1.06 million barrels a day in the four weeks to July 19, down from a revised 1.1 million barrels a day for the period to July 12. About 840,000 barrels a day was on tankers destined for India, down from 1.43 million barrels a day in the earlier period.

But there is the equivalent of 1.99 million barrels a day on vessels yet to show a final destination. Of that, about 1.67 million barrels a day is on ships from Russia’s western ports showing their destination as Singapore, Port Said or the Suez Canal, or those from Pacific ports with no clear delivery point, and a further 320,000 barrels a day is on tankers yet to signal any destination.

Flows to Turkey in the four weeks to July 12 were unchanged at about 160,000 barrels a day, the highest in almost three months.

Four-week flows to Syria averaged about 30,000 barrels a day, down from a revised 60,000 barrels a day for the period to July 12. But this figure could be revised once ship destinations become clear. Tankers hauling Russian crude to Syria rarely signal their destination and usually disappear from automated tracking systems when they’re south of Crete, making it difficult to estimate flows in advance of ships arriving off the port of Baniyas, where they can often be picked up on satellite photos.