India’s crude oil imports from Russia in June were the cheapest since the Russian invasion of Ukraine, during which time the world’s third-largest oil importer became a key Russian oil customer alongside China.
The average cost of a barrel of Russian crude that landed at India’s ports in June was at $68.17, per data from India’s Ministry of Commerce and Industry cited by Bloomberg. The price exceeds the $60 price cap set by the G7, but the cap does not include shipping.
Most of India’s purchases of Russian crude oil are being done on a delivered basis inclusive of freight, insurance, and other costs.
To compare, India paid $70.17 on average per barrel of Russian crude in May and $100.48 a barrel in June 2022, according to the data.
International crude oil prices were lower in June compared to July and early August amid concerns about the global economy and the uneven Chinese recovery after the end of the Covid restrictions.
But prices have rallied in recent weeks as hopes have grown of a soft landing of the U.S. economy. Analysts and traders expect the supply cuts by OPEC+ and the unilateral output and export reductions from Saudi Arabia and Russia, respectively, to tighten the market for the rest of the year.
India’s crude oil imports from Russia dropped in July and could be headed to a more significant decline in August, to the lowest since January this year, according to Kpler.
In July, crude imports from Russia into India, the world’s third-largest oil importer, dropped to 2.09 million barrels per day (bpd), down from 2.11 million bpd in the previous month, Viktor Katona, head of crude analysis at Kpler, told Bloomberg last week.
This month, India’s crude oil imports could further decline and fall to 1.6 million bpd, Katona added. If the projection is correct, India’s imports of Russian oil in August could drop to their lowest level since January 2023.