Discounts on Russian Urals crude oil supplied to India have narrowed to $1–2 per barrel compared to the Brent benchmark this week. Three trading sources told Reuters, reports UNN.
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As noted, the sharp reduction in the discount indicates a significant change in the market situation compared to early July, when Urals cargoes were sold in India at a discount of over $10 per barrel due to an oversupply of Middle Eastern oil and weak demand from China.
China and India remain the largest buyers of Russian oil, whose exports have been redirected from Europe to Asian markets following the imposition of Western sanctions in response to Russia's full-scale invasion of Ukraine.
According to sources, Indian refineries have stepped up purchases of Russian oil due to new concerns about the reliability of supplies from the Middle East after the resumption of US military action against Iran and new disruptions to tanker traffic through the Strait of Hormuz.
Indian refineries are buying large volumes of Russian oil this year as it has proven to be a stable feedstock
At the same time, the interlocutor emphasized that prices remain very volatile due to geopolitical tensions affecting global markets.
This week, Chinese refineries also increased purchases of Russian oil amid supply disruptions from the Middle East. According to trade data and information from market participants, in the second quarter, India's crude oil imports from Russia and Latin America rose sharply, while imports from the Middle East declined due to supply restrictions through the Strait of Hormuz.
Russian oil continues to hold a significant share of Indian imports due to competitive prices and supply stability, despite periodic market fluctuations and logistical difficulties.