India has enabled indirect trade of oil from Russia to Europe, Reuters reports.
India’s refiners have seen a boost in exports of diesel and jet fuel to Europe after importing record quantities of Russian oil last year.
Access to cheap Russian crude oil, a result of EU sanctions on Russian oil and oil products, has boosted outputs and profits from Indian refineries. This has in turn enabled them to export refined products competitively to Europe and take a larger market share.
Before Russia’s invasion of Ukraine, Europe imported an average of 154,000 bpd of diesel and jet fuel from India. Since the EU’s ban on oil products came into effect last month, this has risen to 200,000 bpd.
India’s diesel exports to Europe rose 12-16% in the last fiscal year, reaching 150,000-167,000 bpd. The main European buyers of Indian diesel are France, Turkey, Belgium and the Netherlands. Approximately 50% of India’s jet fuel exports in fiscal year 2022-2023, or 70,000-75,000 bpd, were sent to Europe. This is up from 40,000-42,000 bpd in the previous year, Reuters’ analysis of data found.
India’s imports of Russian crude oil rose for the seventh straight month in March, ending this fiscal year with Russia as India’s largest supplier. Since the beginning of sanctions, Russian oil exports to India have increased by 2200%, according to deputy Prime Minister Alexander Novak.
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While Russia’s flagship grade Urals oil makes up the bulk of India’s purchases, refiners are also importing lighter grades. These have come from Russia’s Far East and Arctic, with grades such as Sokol, Arco, Novy Port and ESPO blend.
India has also boosted its vacuum gas oil shipments to the US. In 2022-2023, the US took approximately 11,000-12,000 bpd of the refined fuel, totally 65-81% of India’s overall exports.
However, India’s total annual refined fuel exports in 2022-2023 were lower than the previous year, due largely to refiners closing for maintenance in the latter half of last year.