Indian oil refiners are snapping up millions of barrels of prompt Russian crude cargoes to compensate for supply deficits triggered by the ongoing war with Iran, according to Reuters.
The country remains highly vulnerable to supply shocks, as its strategic reserves cover only about 25 days of domestic demand. Furthermore, approximately 40% of India's crude imports transit through the volatile Strait of Hormuz.
Following months of pressure from the United States, India had significantly reduced its purchases of Russian crude in January. This strategic reduction helped New Delhi avoid 25% tariffs and secure an interim trade agreement with Washington.
However, state-owned refining companies—including Indian Oil Corp (IOC), Bharat Petroleum (BPCL), Hindustan Petroleum (HPCL), and Mangalore Refinery and Petrochemicals (MRPL)—are now actively negotiating with traders. Industry sources indicate that approximately 20 million barrels have already been secured for delivery between March and early April.
This urgent demand has sharply altered pricing dynamics. Russian Urals crude has swung from a discount of around $13 per barrel in February to a premium of $4 to $5 per barrel over the global Brent benchmark on a delivered basis. Sources also noted that private refiner Reliance Industries is seeking prompt cargoes, with refiners reportedly drawing oil directly from tankers waiting off the Indian coast.
It remains unclear whether the U.S. has granted tacit approval for the renewed purchases. According to one source, New Delhi has formally requested clearance from the Trump administration to proceed with the imports.