India’s refiners, which are state-owned companies, have been in contact with Russian traders who sell crude.
Bloomberg reported that these discussions indicated there was enough supply to satisfy the current demand.
The recent US sanctions have eased concerns about the possibility of a slowdown in crude oil flow over the next few months.
Reports from industry executives reveal that the number of offers on discounted Russian oil has increased as March bookings for Urals-loading cargoes open later this week.
The increase in trade is due to India accepting non-sanctioned tankers, traders and insurance companies.
Typically, Indian refineries secure crude oil from Russia about two months in advance.
The advance booking allows efficient coordination and planning of logistics for shipping, refineries, and inventory management.
This also helps refiners to reduce the risk associated with volatile markets.
Imports to Russia fell in February
According to Kpler data analytics, India’s imports of Russian oil fell 13.4% from one month to the next, to 1.4m barrels per month last month.
The drop in crude oil prices was a result of Washington’s sanction on 161 tankers. Middlemen who were shipping Russian crude into India temporarily suspended cargo offers.
India has declared that it will not permit sanctioned ships to dock at its ports. This is causing buyers to steer clear of them.
Indian buyers expressed their concerns about the continuation of Russian oil exports in this past year.
The hope was that alternative tankers or intermediaries will emerge in order to continue the flow of Russian crude oil despite sanctions and restrictions.
They also showed caution, and resisted making purchases of sanctioned ships, due to potential risk and uncertainty.
Some Indian buyers feared delays and disruptions due to the complicated geopolitical environment and potential complications.
Confidence improvement
According to executives in the oil and gas industry, both confidence and availability have improved.
The positive outlook can be attributed to the recent news reports that the advisors of President Trump are looking into the possibility lifting or altering certain Russian sanctions including the cap on oil prices if peace negotiations progress.
This has contributed to an increase in optimism on the stock market.
Industry insiders warn that bookings in the next month for delivery in May will test this confidence.
The news about possible sanctions relief is encouraging. However, the level of actual demand in May and buyers’ willingness to make purchases will determine the sustainability of this market recovery.
Kpler data revealed that vessels such as Shenlong and Bourda which do not normally transport Russian crude oil are making their way into Indian ports.
Reduce pressure
In India, the emergence of new vessels has already been evident and contributes to ease pressure.
India expanded its insurance options after granting Soglasie Insurance Co, a non-sanctioned company, permission to cover vessels that enter Indian ports up until the end of February 2026.
India also extended its approval to Alfastrakhovanie Insurance Co. and Sogaz Insurance Co.
The Executives reported that discounts for offered cargoes had decreased from $1 to $3 per barrel in comparison to benchmark crude.
Before the new sanctions, the discount on barrels dropped from $2.5 to $3.50.
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