India rebalances crude slate as Saudi gains, Russian flows ease under sanctions pressure

Ship tracking data showed Russian shipments to India declining from 1.28 million bpd in December 2025 to 1.22 million bpd in January and further to around 1.09 million bpd in early February, down about 10% month-on-month.

New Delhi: India's crude import strategy is entering a phase of calibrated rebalancing rather than abrupt realignment, with Middle Eastern suppliers led by Saudi Arabia regaining market share even as Russian volumes remain significant but increasingly shaped by geopolitics and compliance constraints, according to shipping data and analysts.

During February 1-18, India's total crude imports averaged 4.85 million barrels per day (bpd), down 8 per cent from January's 5.25 million bpd, as flows from Russia cooled following US sanctions on key Russian exporters and the European Union's 18th sanctions package coming into effect last month.

Ship tracking data showed Russian shipments to India declining from 1.28 million bpd in December 2025 to 1.22 million bpd in January and further to around 1.09 million bpd in early February, down about 10 per cent month-on-month.

"Russian crude imports into India are estimated at around 1.0-1.2 million bpd in February, easing toward roughly 800,000 bpd to 1 million bpd in March," said Sumit Ritolia, Lead Research Analyst, Refining & Modeling at real-time global commodity intelligence and analytics Kpler.

Import of Russian crude, which India started to binge on once they were available at a discount post Ukraine war in 2022, are seen stabilising rather than collapsing.

"However, we continue to see this as a short-term stabilisation rather than a return to the mid-2025 peak, and we expect Russia's share in India's crude slate to gradually stabilise to a lower range in 2026 compared to 2024-2025 as commercial and policy frictions build," he said.

This assessment is based on reports of a pragmatic understanding between the United States and India that effectively allows "baseload" Russian imports while discouraging any material expansion. Near-term volatility is expected to remain driven by sanctions risk, shipping constraints and logistics rather than pure pricing dynamics.

As Russian volumes ease, the Middle East Gulf is filling the gap. Shipments from Saudi Arabia are set to reach 1 million to 1.1 million bpd in February - the highest since November 2019 - with month-to-date arrivals tracking even higher at around 1.4 million bpd before expected moderation into early March, Ritolia said.

On current trends, Saudi Arabia is positioned as India's top supplier in February, followed by Russia and Iraq.

Post Ukraine war, Russia had replaced Iraq as India's biggest supplier, accounting for as much as 40 per cent of all crude oil that India imported for processing into fuels like petrol and diesel, at peak. Wave of EU and US sanctions have since tapered imports from Russia.

At the core of Russian oil imports is Vadinar refinery in Gujarat. The unit, where Russia's Rosneft is the biggest shareholder, has been cut from other suppliers after EU slapped sanctions on its for links with Moscow.

The unit now solely relies on Russia to meet its crude needs.

Ritolia said the expectation seems to be that India can maintain volumes needed to support refinery operations and domestic fuel supply, but should avoid materially increasing purchases beyond that baseline.

"In practice, these points to Russian flows stabilising at a lower but persistent level through short-term, especially until the trade deal between the US-India is finalised and signed, while India continues to diversify supply from incremental buying from Venezuela and Middle East barrels regain share, with Russian crude increasingly shaped by geopolitical and compliance factors rather than pure economics," he said.

From a market structure perspective, India is not positioned to fully replace Russian barrels without cost, he said.

"Russian grades have provided a rare combination of medium sour quality, stable availability, and discounted pricing, which has been particularly valuable for complex refiners optimised for sour processing," he said. "As India reduces Russian barrels, the overall crude cost is expected to go up USD 2-3 per barrel; however, cheaper Venezuelan crude buying could partially offset this." However, Venezuelan crude import will only be at a marginal or supplementary level and cannot replace Russian barrels.

"That said, Venezuelan supply is structurally constrained by production limits, logistics, and compliance risks, so it is unlikely to fully replace Russian volumes - but it can help reduce the cost impact at the margin if flows continue to build," he said.

With flows from Saudi Arabia rising to the highest level since November 2019, the immediate replacement for softer Russian flows has largely come from the Middle East, particularly Saudi Arabia.

"While Saudi Arabia is currently positioned as India's largest supplier in February (till date), followed by Russia and Iraq and as the month closes, we expect some moderation in volumes from Saudi Arabia and overall Volumes from Iraq and Saudi Arabia to be similar around 1-1.1 million bpd," he said, adding this is still a multi-year high.