- India cut its purchases of Russian crude in July and pivoted to Saudi oil for its cheaper prices.
- Its purchases of Russian oil dropped about 7.3% but increased its imports of Saudi crude by 25.6%.
- Appetite for Russian crude appears to be waning as robust demand and tight supply push up prices.
India slashed its purchases of Russian crude in July for the first time since March this year in the face of cheaper Saudi oil, Reuters reported.
Oil shipments to India averaged 877,400 barrels per day from Russia last month. That’s about a 7.3% decline from June.
Meanwhile, India oil imports from Saudi Arabia rose by 25.6% in July to their highest in three months, Reuters said. Imports reached 824,700 barrels per day after Riyadh reduced its official selling price to Asian customers in June and July.
India and China are the largest importers of Russian crude right now, as Western sanctions on Moscow have deterred buyers in markets like Europe and slashed the value of its oil. Exports of Russian oil to Asia have reeled in stunning revenues for the country where it is expected to generate $285 billion this year from its oil and gas sales.
But appetite for Russian crude appears to be shrinking as a pickup in prices for Russian crude fueled by strong demand wards off some of its most eager buyers. Last week, Russia crude exports to Asia fell to their lowest level since the war, with daily flows dropping below 2 million barrels per day.
At the same time, Russia is tapping into new markets to export its oil where Bloomberg cited data showing Russian tankers were headed for Sri Lanka and Egypt.
Saudi Arabia is not the only oil producer luring in more Asian buyers however. Cheaper US crude is also attracting refiners in South Korea and India in a sign that competition between the world’s largest oil producers is heating up.