US Waiver Set to Maintain Record-High Russian Oil Exports to India

Russian Oil Sales to India Set to Remain Near Record Highs

Russian oil sales to India are poised to remain near record highs in April and May following a new U.S. sanctions waiver. According to traders and data, refiners have already secured much of their supply needs via non-sanctioned entities and vessels.

The robust exports to India, the second-largest buyer of Russian crude after China and largest importer of its flagship Urals grade, will likely help Moscow replenish state coffers under pressure due to military spending for the war in Ukraine. India shipped in a record 2.25 million barrels per day of oil from Russia in March, nearly double February's volumes, making Russian oil 50% of its imports.

Russian Crude Arrivals at Indian Ports

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Russian crude arrivals at Indian ports are set to reach 2.1 million bpd for the week of April 20 to 27, up from 1.67 million bpd the previous week, data from shipping analytics firm Kpler showed. This represents a significant increase in Russian oil deliveries to India, which is likely to continue in the coming months.

Impact of U.S. Sanctions Waiver

The U.S. issued a 30-day waiver in mid-March for countries to buy sanctioned Russian oil and petroleum products to help stabilise global energy markets roiled by its war with Iran. It renewed the waiver last week. Despite the sanctions, which are intended to pressure Moscow to negotiate a peace deal with Kyiv, Russian oil deliveries to India have continued via non-sanctioned enterprises in the supply chain.

Indian Refiners Secure Russian Oil Supplies

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Indian refiners had already been actively purchasing Russian oil in April before the waiver extension was announced and secured most of the volumes for May delivery as early as last week, according to traders. Refineries in India were paying premiums of $7 to $9 per barrel of Russian oil to the dated Brent for cargoes delivered in May, similar to what they paid for April imports.

Indian Expansion of Russian Insurers

India has recently expanded the pool of Russian insurers eligible to provide marine cover to ships docking at its ports, increasing the number to 11 from eight, according to its Directorate General of Shipping. This move is expected to further facilitate Russian oil deliveries to India.