India’s top refiner replaces Russian crude oil with US, Canadian, and Abu Dhabi oil amid trade sanctions and tighter discounts.
Global oil trade dynamics are changing as Indian Oil Corporation (IOC), the major refiner in India, has bought 7 million barrels of crude oil from the United States, Canada, and the Middle East for their September delivery.
The move follows a walkout in Russian oil imports amid reduction in prices and rising geopolitical pressure, with renewed sanctions of US and EU.
IOC’s Purchase Marks Strategic Diversification
4.5 million barrels of US West Texas Intermediate (WTI) Midland crude, 500,000 barrels of Canada’s Western Canadian Select (WCS), and 2 million barrels of Das crude from Abu Dhabi is acquired by IOC, according to some of the trade sources. The tender shuts last Friday, with confirmed supplies from companies.
This spot market purchase is knowingly bigger than usual purchases of IOC. This marks a prominent shift as India has been the major buyer of seaborne Russian crude since 2022.
Geopolitical Pressures Influence Import Pattern
The shift follows continuous warnings from US President Donald Trump, who has threatened secondary sanctions on countries purchasing Russian oil. New sanctions by the European Union are also affecting the Russian energy sector.
As a result, numerous Indian state refiners, including IOC, Bharat Petroleum, Hindustan Petroleum, and Mangalore Refinery, have not placed new orders for Russian crude in current weeks.
The arbitrage window for US crude shipments to Asia has unlocked wider due to falling freight rates and altering demand patterns, making US grades more competitive in Indian tenders.
India’s Energy Security Amid Sanctions Risk
India is the world’s third-largest oil importer, and any change in its sourcing strategy has a quantifiable impact on global crude flows. While officials maintain that long-term Russian oil consumptions remain under review, these tender highlights how Indian refiners are adjusting procurement to balance energy needs, pricing, and geopolitical risks.
As India continues to direct supply chain constraints and diplomatic pressures, its oil import strategy is likely to remain dynamic into Q4 2025.
Also Read: Could US-Russia Tensions Push Crude Oil Prices To $80? Experts Weigh In On The Potential Surge
Ankur Mishra is a journalist who covers an extensive range of news, from business, stock markets, IPOs to geopolitics, world affairs, international crises, and general news. With over a decade of experience in the business domain, Ankur has been associated with some of the reputed media brands. Through a sharp eye on global marketplaces along with deep insights and analysis of business strategies, Ankur brings simplicity to the complex economic matrix to decode market trends and empower people.
He is committed to entrenched data, facts, research, solutions, and a dedication to value-based journalism. He has covered trade tariff wars, international alliances, corporate policies, government initiatives, regulatory developments, along with micro- and macroeconomic shifts impacting global fiscal dynamics.
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