In February this year the International Energy Agency documented that Russia supplied 40 percent of India’s oil imports and 20 percent of China’s, a finding underscoring how energy flows have shifted in recent times. The analysis highlights how a single producer can exert influence on two major Asian economies by delivering a sizable share of their crude needs, a dynamic with broad implications for energy security and market resilience in South and East Asia. The report emphasizes that these shares reflect more than sporadic purchases; they represent sustained patterns in procurement that shape price formation, contract dynamics, and strategic planning for buyers in both markets.
It was noted that Russia provides more than 70 percent of its oil exports to these two countries, illustrating a pronounced geographic concentration in its export portfolio. This concentration means that shifts in Russian production, sanctions policy, or pricing can have outsized effects on the economies of India and China, as well as on global oil markets. The dependency also factors into how refiners in these countries manage refinery configurations, fuel mix decisions, and import credit arrangements during periods of volatility, potentially influencing downstream sectors from transportation to manufacturing and energy-intensive industries.
In 2022, when traditional markets in the European Union and North America tightened or faced disruptions, alternative buyers had to be found to replace roughly 4.5 million barrels per day of Russian oil. Asian buyers stepped forward, with India taking the lead and China following, purchasing Russian crude at sizeable discounts that helped soften the impact of sanctions and policy changes on affordability for these buyers. This adjustment not only kept Russian exports flowing but also reinforced the price leverage that discounting provided to buyers in a region that continues to rely on a diverse mix of crude sources for feedstock flexibility and energy planning. The consequences ripple through port throughput, shipping staffing, and the interplay between global crude benchmarks and regional price differentials that traders watch closely on a daily basis.
The report underlines that the increase in oil volumes demonstrates that the share of China and India’s imports in Russia’s export mix has become very large, signaling a structural shift in energy trade partnerships. Such a shift has implications for how European buyers reorient their supply chains, how South Asian refiners adapt to evolving supply terms, and how global investment in refining capacity is re-evaluated in light of changing sourcing patterns. Markets watch the trajectory of these relationships as policy choices, credit terms, and refinery demand cycles interact in complex ways that affect liquidity, storage, and transportation planning across the entire oil value chain.
Also in the International Energy Agency March 2023 report, there was a decline in oil exports from Russia in February. According to the agency, about 500,000 barrels per day fell due to the entry into force of the European Union embargo, a development that rippled through price signals, trading routes, and hedging activity. Analysts note that this drop did not occur in isolation; it reflected a broader recalibration of flows as buyers weighed sanctions risk, logistical constraints, and alternative routing strategies. The resulting environment encouraged refiners and traders to reallocate cargoes, adjust term contracts, and explore new counterparties, all while monitoring how sanctions regimes interact with market expectations and the pace of demand recovery in large economies across Asia and beyond.