India’s appetite for oil from Russia appears to be cooling, even as the country weighs its options against Middle Eastern suppliers. In recent remarks captured by Bloomberg, Hardeep Puri, India’s Minister of Oil and Gas, suggested that New Delhi is shifting its procurement strategy toward more cost-effective sources from the Persian Gulf and neighboring regions. He indicated that India’s reliance on Russian crude would decline as the economics of alternative supply routes become more favorable for buyers in Delhi.
According to the minister, the price dynamics of crude oils are shifting in ways that make Gulf grades more attractive for India’s energy mix. The statement noted that the Persian Gulf remains a compelling option for securing reliable energy supplies at scale, which could help India diversify its import basket and reduce exposure to volatility in any single origin.
Since the onset of the latest international developments, Russian oil has traded at meaningful discounts relative to Brent, creating opportunities for buyers to lock in favorable terms. India has reportedly tapped into these discounts during the period of adjustment that followed the international operational changes, aligning its purchases with evolving global price signals while aiming to balance supply security with fiscal prudence.
Nevertheless, the overall cost of Russian energy shipments to India has shown a different trend. Analysts cited by Bloomberg and data from Argus indicate that the Dubai Crude discount to Ural grades has narrowed, moving from around $20 per barrel to roughly $8. This narrowing discount contributes to higher landing costs for Indian buyers when shipping charges and other logistics are factored in. As of mid-August, the landed price of Russian crude delivered to the west coast of India was near $83 per barrel, inclusive of freight, compared with about $70 per barrel a month earlier for Urals shipments to the same region.
Market reports from the Organization of the Petroleum Exporting Countries highlight Russia’s ascent as a major supplier to both China and India, with Russia becoming the top oil supplier to India during parts of 2023. In June, Russia accounted for a sizable share of India’s total crude imports, underscoring the country’s status as a leading energy partner. This period also saw India’s overall crude intake show a modest year-on-year shift, with total imports easing slightly from May to around 4.7 million barrels per day, reflecting the country’s efforts to manage demand and diversify sourcing at the same time. Industry outlets noted that Russia’s role in India’s energy landscape remained prominent through the 2022-2023 fiscal year, signaling a structural shift rather than a temporary adjustment.
In summary, India’s energy procurement narrative is shifting away from a single-origin dependence while seeking price stability and supply security across a broader, more diversified portfolio. While Russia maintains a significant, historical role in India’s energy economy, the focus appears to be on balancing long-term reliability with the economics of Gulf and other regional suppliers as India continues to navigate a changing global oil market.