Indian Refineries Replacing Russian Oil With American One

India is the third largest consumer and importer of oil in the world.

US sanctions against tankers carrying Russian oil in violation of the price ceiling have forced Indian refineries to refuse at least part of Russian supplies. At the beginning of the year, Indian refineries increased purchases of Saudi oil, and now American oil is replacing Russian oil.

About 7.6 million barrels of oil are now heading to India from the United States, or 256,000 barrels per day, the most in more than a year, as tanker tracking data from Kpler shows. Tankers coming from the United States are chartered by Reliance Industries, India's largest private oil refiner, as well as oil trader Vitol and Korean shipping company Sinokor, writes Reuters.

Reliance became the first Indian oil refiner to refuse to work with Sovcomflot after the US imposed sanctions against it in late February. Its ships are used for the shadow fleet that transports Russian oil.

Following Reliance, other Indian companies, including state-owned ones, stopped accepting cargo delivered by Sovcomflot. Refineries now carefully check the data on each tanker, wanting to make sure that it is not associated with Sovcomflot or any other sanctioned organization, Bloomberg reported, citing industry sources. Since last autumn, the United States has also punished several companies and dozens of tankers from the UAE and Turkey for violating requirements to comply with the price ceiling of $60 per barrel.

According to industry sources Reuters, the refinery's actions could affect overall Russian oil supplies because it will be less accepted in India. The country is the third largest consumer and importer of oil in the world.

India bought 22% more oil from Saudi Arabia in February than in January, and Reliance Industries purchased the highest volume since May 2020, according to Kpler. In the spring-summer of last year, supplies from Russia to India amounted to 2 million barrels per day or more, from the autumn to the end of February — 1.4-1.6 million barrels per day, and in the last three weeks (until March 24) fell to 1 .2 million, according to Bloomberg ship tracking data. True, some tankers heading to Asia traditionally do not indicate their destination; it will become clear at the end of the voyages, the agency notes.