Russian oil exports to India will increase in September, traders said, as producers lower prices to sell more oil because they cannot process as much oil at refineries after drone attacks on energy infrastructure, Reuters reports, writes UNN.
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India has become the largest buyer of Russian oil supplies, which were displaced by Western sanctions after Moscow's invasion of Ukraine in 2022. This allowed Indian refiners to benefit from cheaper oil.
But these purchases drew condemnation from the administration of US President Donald Trump, who on Wednesday increased US tariffs on Indian imports to 50%.
US imposes 50% tariffs on Indian goods: how Delhi reacted27.08.25, 10:15 • [views_3837]
New Delhi says it is relying on negotiations to try to resolve the issue of Trump's additional tariffs, but Indian Prime Minister Narendra Modi has also embarked on a tour to develop diplomatic ties in other countries, including a meeting with Kremlin head Vladimir Putin.
American officials accused India of profiting from discounted Russian oil, while Indian officials accused the West of double standards, as the EU and US still buy billions of dollars worth of Russian goods.
Without India, it would be difficult for Russia to maintain exports at existing levels, and this would reduce oil export revenues that finance the Kremlin's budget and the continuation of Russia's war in Ukraine, the publication notes.
Three trade sources involved in oil sales to India said that Indian refineries will increase purchases of Russian oil in September by 10-20% compared to August levels, or by 150,000-300,000 barrels per day.
Sources cited preliminary purchase data.
Russia has more oil to export next month as planned and unplanned refinery shutdowns have reduced its capacity to refine oil into fuel. As indicated, 10 Russian oil refineries have been hit in recent days, disabling up to 17% of the country's refining capacity.
According to Vortexa analysts, in the first 20 days of August, India imported 1.5 million barrels of Russian crude oil per day, unchanged from July, but slightly below the average of 1.6 million barrels per day for January-June.
The volumes are equivalent to approximately 1.5% of global supplies, making India the largest buyer of seaborne Russian oil, which covers about 40% of India's oil needs. China and Turkey are also major buyers of Russian oil.
Russian exporters sold Urals oil in September at discounts of $2-3 per barrel compared to benchmark Brent oil, three traders said. These levels are lower than the $1.50 per barrel discounts in August, which were the smallest since 2022, traders said.
"Unless India issues a clear political directive or the economics of trade change significantly, Russian oil is likely to remain a core part of its supply structure," said Sumit Ritolia of Kpler.
Brokerage CLSA also predicts in its note only a "limited probability that India will stop imports from Russia" unless a global ban is imposed.
It was also noted that if Russian oil imports to India were stopped, the consequence could be a reduction in global supplies by approximately one million barrels per day and a short-term increase in global prices to almost $100 per barrel.
Traders said the full impact of sanctions and tariffs may only be visible on cargoes arriving in India in October, trading for which will begin in the coming days.
In addition to US tariffs, the European Union has also tightened its price cap aimed at limiting Russia's oil revenues, which will make sales more difficult later this year.
The EU set the cap at $47.60 per barrel from September 2 - 15% below the market price of Russian crude oil - limiting access to Western services for cargoes sold above the cap.