India imported crude oil worth 49 billion euros from Russia in the third year of the latter’s invasion of Ukraine, as per the latest report by Centre for Research on Energy and Clean Air.
“Russia’s stronghold over new markets has also solidified in the third year of the invasion. The three biggest buyers, China (78 billion euro), India (49 billion) and Turkey (34 billion) were responsible for 74% of Russia’s total revenues from fossil fuels in the third year of the invasion,” the report said, adding that the value of India’s imports saw a year-on-year increase of 8%.
As per the report’s findings, Russia’s total global fossil fuel earnings in the third year of the invasion reached 242 billion euros and have totalled 847 billion euros since it first invaded Ukraine.
India is the third largest consumer of crude oil and imports as much as 85% of its crude oil requirements. Post the outbreak of Russia-Ukraine conflict, Russia became the top supplier of crude oil to India on the back of heavy discounts that Moscow offered in its supplies.
As per the report, in the second year of the invasion, G7+ oil sanctions cut Russian revenues from Urals grade crude exports by 10 billion euros, at an average of 20% (793 million euros) per month. However, In the third year of the invasion, this impact shrunk significantly, with Russian Urals crude oil revenues hurt by 2.6 billion euros, a mere 6% (240 million euros) reduction on average per month.
“In the third year of the invasion, G7+ countries imported 18 billion euros of oil products from six refineries in India and Turkey that process Russian crude. An estimated 9 billion euros of this was refined from Russian crude,” said the report.
In the first three quarters of 2024, as refineries in India and Turkey increased their consumption of Russian crude, the volume of Russian crude used to create products for G7+ countries jumped by an estimated 10%. Concurrently, this also contributed to a rise in the price of Russian oil, boosting the value of the crude used for these exports by an estimated 25%.
The EU is the biggest importer of oil products from India’s and Turkey’s refineries. On average, 13% of these refineries’ total production is targeted towards exports for the bloc in the third year of the invasion.
The top five importers within the EU were the Netherlands (3.3 billion euro), France (1.4 billion euro), Romania (1.2 billion euro), Spain (1.1 billion euro), and Italy (949 million euro). The single biggest buyer was Australia, whose imports from these refineries totalled 3.38 billion euro in the third year of the invasion.
In the third year of the invasion, 23% of the oil transshipped in EU waters was destined for China, 11% for India, 10% for South Korea, and 2% for Turkey, with the remainder distributed among other markets.
As per CREA’s data, 331 shipments arriving in India’s Sikka port averaged $90.8 per barrel from February to September 2024. In this period, 65% of the tankers were subject to the cap.
Applying the price cap to cost, insurance and freight (CIF) price would have cut Russia’s crude export revenues by 34% — about 5.8 billion euro in 2024, as per the report.
Russia first started offering discounts on its oil as a counter to G7+ oil sanctions and to attract new markets. Many non-sanctioning countries used this to satisfy domestic demand, but a key loophole in the sanctions increased this flow significantly over time. “The loophole in the legislation allowed non-sanctioning countries to import Russian crude, refine it, and export the refined products to G7+ countries,” said the report.
The price discount on Russian oil, however, has come down to less than $3 per barrel for Indian refiners compared to earlier high levels of $18-20 per barrel.