US Exemption Drives Surge in Indian Imports of Russian Crude

Due to the U.S. exemption on oil tanker shipments of Russian crude oil and supply disruptions in the Middle East, Indian refiners are returning to purchase Russian oil. India is gaining a competitive edge over foreign rivals in attracting Russian crude cargoes, with ships changing course mid-voyage to leave their original destinations and head toward India.

According to MarineTraffic tanker tracking data, the crude oil tanker Aqua Titan— which departed from the Russian Baltic port of Primorsk in mid-January— has turned around in the South China Sea and is now heading to Mangalore, India, with an expected arrival date of March 21.

Data from Vortexa indicates that at least seven oil tankers carrying Russian oil have changed their destinations mid-route to India.

Earlier this year, when most buyers avoided Russian crude due to U.S. sanctions and India faced pressure to cut its Russian oil imports, Russia and India competed for millions of barrels of Russian crude stranded on stuck tankers.

Now, with the U.S. allowing everyone to purchase Russian crude and increased competition for Russian supplies in Asia, the prices for key Russian crude grades have shifted to a premium over Brent, whereas just a month ago, they were heavily discounted.

Vortexa Chief Economist David Weech said last Friday that since early March, the volume of Russian oil on water has decreased by over 20 million barrels, equivalent to a daily reduction of more than 2 million barrels.