Not only has India emerged as the biggest buyer of Russia’s seaborne flagship crude oil, Urals, two of its private players have taken 45 per cent of Russia’s shipments of the medium-sour variety, according to data analytics provider Kpler.
This comes despite Russia’s narrowing discount margins on its flagship oil as demand for Russian oil was increasing from Turkey.
In July, spot discounts for Urals crude narrowed to $2.25 per barrel for cargoes arriving in India from $2.70 to $3.10 per barrel to Dated Brent on delivery ex-ship (DES) basis in the previous month, sources have revealed.
In this year, India has taken 80 per cent of Russian seaborne Urals, while its imports totaled 231 million barrels through June 24, said Kpler. In 2024, India had taken 74 per cent of Urals from Russia.
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Two of India’s private refineries – Reliance Industries and Nayara – have steadily increased their buying of Urals, jumping sharply this year. Reliance, India’s largest private refinery, took 77 million barrels a day of the grade this year. It has now become the world’s single biggest buyer of Urals.
Owned by businessman Mukesh Ambani, Reliance has entered into a 10-year agreement with Russia to buy as much as 500,000 barrels a day of oil from January. The new contract now puts Reliance crude purchases from Urals at 36 per cent, up from 10 per cent in 2022.
Kpler also said grade accounts for a massive 72 per cent of Nayara’s oil buying, as compared with just 27 per cent three years ago.
Traditionally, Chinese independent refineries, also known as teapots, have been the biggest buyers of Russian oil. But they too have been feeling the heat this year because of a stricter tax regime and weak local demand.
India’s major state-owned refiners — including Indian Oil Corp., Bharat Petroleum Corp. and Hindustan Petroleum Corp Ltd. — haven’t entered into any term deals with Russia.
Sources have also said that an increase in buying of Russian oil by Nayara and Reliance has also contributed to lower spot market discounts to Date Brent for India’s state-owned refineries to less than $2 a barrel from $4 in the second quarter of last year.
Hindustan Petroleum is pursuing a more diversified buying strategy for 2025, bringing in barrels from places like Gabon and the Republic of the Congo, said Yan Rong Fong, an oil market analyst at Kpler.
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