Buyers' interest in Russian oil in India and China is growing due to concerns about supplies from the Middle East, although prices have not yet changed. Five traders told Reuters about this, UNN writes.
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Supply disruptions through the Strait of Hormuz in the southwest of the Persian Gulf have complicated the availability of Middle Eastern oil grades and caused freight costs to rise, traders and analysts noted.
Indian refiners have approached Russian suppliers for urgent deliveries for March and April, two traders and one industry insider said.
Indian refiners are now consulting with the government on the possibility of additional imports from Russia
Chinese buyers are also showing interest, although recent purchases have allowed them to have a reserve.
China bought large volumes at low prices before the Chinese New Year, so they can afford to wait until the situation with the war in Iran becomes clearer
Another trader added: "Buyers expect the conflict in Iran to end soon and do not want to pay more at current Brent prices."
In recent months, China has absorbed oil volumes that were diverted from India, increasing its seaborne purchases to multi-month highs at deep discounts, traders noted.
The discount on Russian Urals oil shipped from the port of Primorsk (FOB) was $25-26 per barrel to the Brent price on Tuesday, remaining at the level of recent estimates, according to the latest LSEG data.
Discounts at Chinese and Indian ports on a delivered basis also remained almost unchanged from levels before the start of the conflict in Iran.
China and India are already major buyers of Russian oil, although India has recently reduced purchases due to pressure from Washington.
Oil imports to India are expected to drop sharply in April due to scheduled maintenance at Nayara Energy, which is partly owned by Russia's Rosneft and is a major buyer.
Other Indian refiners also planned to cut purchases, but turbulence in the Middle East has forced some to reconsider their plans, traders said.
Russian Deputy Prime Minister Alexander Novak said on Wednesday that Moscow is ready to increase oil supplies to China and India, media reported.