New Delhi: In response to disruptions in US oil supply due to the Red Sea crisis, India reorients its crude oil imports from Iraq, with January reaching a 21-month high. Ship tracking data analysis reveals a surge in imports from West Asia as Indian refiners grapple with elevated freight rates affecting the US supply.
While the US has been a consistent top-five crude supplier to India, January 2024 witnessed no US crude deliveries to Indian refiners, according to preliminary data from Kpler. The Red Sea disruptions prompted a shift towards more accessible options closer to home, especially as freight from the Atlantic Basin became prohibitively expensive.
Notably, oil cargoes from West Asia to India usually bypass the Red Sea’s Bab el-Mandeb strait, minimizing security concerns. Iraq, India’s second-largest crude source, saw January imports surge to 1.19 million bpd, the highest since April 2022.
The disruption in US crude supplies led to increased imports from the United Arab Emirates (UAE), rising nearly 81% in January. Meanwhile, crude imports from Saudi Arabia, India’s third-largest supplier, slightly decreased to 690,172 bpd. Overall, Indian refiners imported 4.81 million bpd of crude in January, a 9.3% increase from December.
Despite heightened geopolitical tensions, oil imports from Russia, India’s largest supplier, remained stable at 1.53 million bpd. The security situation in the Red Sea has impacted global goods and energy supplies, leading to major shipping lines avoiding the route.
Russia’s Urals crude supply to India remained robust, with volumes at around 1.2 million bpd in January, while Sokol crude deliveries were disrupted due to payment issues. The lack of Sokol volumes boosted alternative supplies from Iraq and the UAE.
As India navigates these supply challenges, the Red Sea crisis continues to reshape global oil dynamics, impacting traditional trade routes and supplier preferences.
India Oil Imports, Red Sea Crisis, Crude Oil Market, Geopolitical Impact, Global Trade, Oil Supply Shift, Indian Refiners, West Asia Oil, Kpler Data, Red Sea Disruptions, Global Oil Dynam, Slider
