A doubling of the discount of Russia’s flagship Urals crude grade to Dated Brent could prompt more Russian oil purchases from Indian refiners in the coming weeks.
The discount of Urals to Dated Brent has widened to $2.00-$2.50 per barrel sources with knowledge of the market pricing told Bloomberg on Wednesday. The differential has now doubled compared to the $1.00 a barrel discount for Urals versus Dated Brent in July and August.
India’s crude oil imports from Russia are estimated to have dropped by about 100,000 barrels per day (bpd) in September compared to August as Indian refiners expand crude sources amid ongoing U.S.-India trade talks and U.S. pressure on the world’s third-largest crude importer to stop importing Russian oil.
India imported on average 1.61 million bpd of crude from Russia last month, down from 1.72 million bpd in August and a 16% decline compared to September last year, according to Kpler data cited by Bloomberg.
For October, Kpler has estimated that India’s crude imports from Russia are on track to rebound to about 1.7 million bpd. This would be slightly lower compared to the import levels in October 2024, per Kpler’s estimates of ship-tracking data cited by Bloomberg today.
More crude oil from Russia has become available for Indian refiners as Ukrainian drone attacks have reduced the Russian refining capacity, an Indian government official Reuters on Monday.
The ample supply has led to widening discounts for the flagship Russian grade Urals, which has become a favorite with Indian refiners since India significantly ramped up imports of cheap Russian crude in 2022.
Russian crude supply accounts for about a third of all crude arrivals in India. Despite U.S. pressure and difficult trade talks, Indian officials have repeatedly said the country would continue to buy Russian oil as cheap crude is in its national interest.
By Tsvetana Paraskova for Oilprice.com
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