In October, Indian refiners upped their demand for cheaper Urals as they reduced imports of more expensive Russian grades to minimize expenses. Urals, the flagship Russian crude that sells at a $10 discount to more costly grades like ESPO and Sokol, accounted for 90% of all Russian imports in October. This compared to 72% in September and 75% on average from January to September.
According to Vortexa, India's total imports of Russian oil fell 4% sequentially to 1.55 million barrels per day (mbd) in October, while Chinese purchases of seaborne Russian crude stayed unchanged at 1.2 mbd. Analysts do not anticipate an increase in Indian imports from Russia in November.
Due to the Middle East war, OPEC+ production limitations, and confusing global demand signals, oil prices have been high and unpredictable in recent months.
"Indian refiners take Russian supply because it comes cheap. Russian grades, which make commercial sense, will get preference," said an executive at an Indian refiner.
India's overall imports of Russian crude dropped 4% sequentially to 1.55 million barrels per day (mbd) in October, while Chinese imports of seaborne Russian crude remained little changed at 1.2 mbd during the month, according to Vortexa. Analysts don't expect Indian imports from Russia to rise in November.
"Due to limited availability and narrow discounts of Russian crude to Brent, we may not see an increase in Russian crude imports by India in November," said Serena Huang, an analyst at Vortexa.
