Shipments of Russian crude to India have taken a big hit in recent weeks, after fresh European Union restrictions on petroleum products derived from such crude forced key Indian export refineries to rethink sourcing. Tanker tracking data show India’s imports of Russian crude fell to 1.1 million barrels per day (mb/d) in January — the lowest level since November 2022 and a steep drop from the 1.7 mb/d average recorded through 2025.
In a stark contrast, Russian crude deliveries to China surged to an all-time high last month, underscoring a dramatic redrawing of global oil trade routes.
Regulatory Squeeze
According to tanker-tracking data from Kpler, India imported 33,808 thousand barrels (Kb) of Russian crude in January 2026, down from 38,472 Kb in December 2025 and 55,089 Kb in November 2025. China’s intake, on the other hand, surged to 53,245 Kb in January up from 44,153 Kb in December.
As for India, the EU curbs on Russian crude came on top of the Trump Administration’s insistence that its oil imports from Russia be stopped. The joint statement on recent India-US biletaral trade deal mentions India’s “commitment” to stop purchasing Russian Federation oil, and links this to the US President signing an Executive Order removing an additional 25% punitive tariff on the country.
“China’s primary Russian crude grade has traditionally been ESPO, a light sweet crude, while India’s main Russian import grade has been Urals. However, amid tightening U.S. and EU sanctions, Indian refiners have shied away from Russian barrels. Imports of key Russian grades into India have declined by circa 250,000 barrels per day on average, comparing December and January volumes with the previous five to six months. A broadly equivalent volume of Urals crude has been absorbed by Chinese refiners in Jan-26. This highlights an ongoing shift in Russian crude flows toward China, albeit not necessarily on a one-to-one basis,” said Nikhil Dubey, Senior Refining Analyst, Kpler.
Market Realignment
While India relies entirely on seaborne imports, whereas China also receives crude through two operational pipelines from Russia, which together carry approximately 820 kbd, says another expert on the condition of anonymity.
The shift comes as Russia’s overall oil supply declined by 350,000 bpd in January amid intensified US pressure and broader EU sanctions, according to the International Energy Agency’s (IEA) latest Oil Market Report. India, which had emerged as one of Moscow’s largest buyers since 2022, is now scaling back as compliance risks rise for refiners exporting to Europe.
At the same time, Venezuelan production fell by 210,000 bpd month-on-month to 780,000 bpd in January. However, the IEA expects output to rebound after Washington authorised US-incorporated firms — including US-based subsidiaries of global energy companies — to resume exports under a structured pathway.
Globally, oil supply dropped by 1.2 mb/d in January to 106.6 mb/d, hit by severe winter weather in North America and disruptions in Kazakhstan alongside sanction-driven constraints in Russia and Venezuela. Yet the setback is likely temporary.
World oil supply is forecast to expand by 2.4 mb/d in 2026 to 108.6 mb/d, with growth evenly split between OPEC+ and non-OPEC+ producers, assuming current output agreements hold.
On the demand side, growth remains subdued. Global oil consumption is projected to rise by 850,000 bpd in 2026, compared with 770,000 bpd last year. Non-OECD economies will account for the entire increase, with China contributing roughly 200,000 bpd. Notably, petrochemical feedstocks are expected to drive more than half of incremental demand, marking a structural shift from transport-led growth.
Meanwhile, inventories continue to mount. Observed global stocks rose by 37 million barrels in December, taking total 2025 builds to 477 million barrels — the largest annual accumulation since 2020. Preliminary figures show a further 49 million barrel rise in January.
Despite swelling inventories, benchmark crude prices rallied by nearly $10 per barrel in January amid geopolitical tensions and supply outages, with North Sea Dated trading around $73 per barrel at the time of writing.
With supply growth set to outpace demand in 2026, the IEA warned that surplus barrels may increasingly weigh on balances — even as geopolitical risks keep oil markets finely poised.