India Secures Oil Supply: Russian Imports Surge, Hormuz Risk Eased

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AuthorAnanya Iyer|Published at:
India Secures Oil Supply: Russian Imports Surge, Hormuz Risk Eased
Overview

New Delhi has assured robust crude oil supplies, with imports now diversified across approximately 40 countries. This strategy has shifted roughly 70% of India's crude sourcing away from the Strait of Hormuz. Refineries are operating at peak capacity, bolstered by increased imports, including significant volumes of Russian crude, which analysts predict could reach 2 million barrels per day. While overall supply is comfortable, the availability of LPG will be a key factor to monitor.

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Supply Security Reinforced

India's crude oil security is robust, the government confirmed, highlighting a strategic shift in import routes. The nation, which consumes 5.5 million barrels daily, now sources approximately 70% of its crude from pathways outside the critical Strait of Hormuz. This marks a significant shift from earlier sourcing patterns. This diversification effort involves imports from around 40 countries, mitigating risks associated with geopolitical tensions in key maritime chokepoints.

Surge in Russian Crude

Refineries are running at very high utilization rates, with some operating above 100% capacity. This operational strength is supported by a substantial increase in Russian crude oil imports. Following recent U.S. waivers on certain sanctions, India's intake of Russian barrels has surged. Analysts at Kpler estimate current Russian crude imports at around 1.5 million barrels per day. Projections suggest this could rise to 2 million barrels per day or more by March 2026. This influx significantly bolsters India's energy reserves.

Monitoring LPG Availability

While crude oil and refined product supplies appear secure, attention is now focusing on Liquefied Petroleum Gas (LPG) production. Refineries possess the flexibility to optimize LPG output by adjusting feedstock allocation and operational parameters. Kpler identifies LPG availability as a key short-term factor for India's energy balance. The government is pushing refiners to increase LPG production, supported by steady crude inflows from Russia, the U.S., and West Africa, aiming to ensure sustained energy availability amid global uncertainties.

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