India’s Crude Imports Fall 21% As Iran War Hits Supplies; US Curbs Russian And Iranian Oil

India's crude oil imports fell 21% in the first two weeks of April compared to February, as the Iran war disrupted Middle Eastern supply lines and Washington closed the legal window allowing Indian refiners to buy Russian and Iranian crude.

Imports averaged 4.1 million barrels per day between 1 and 14 April, down from 5.2 million barrels per day in February. It is also 8% below March levels.

Russia Tops, But Window Closes

Indian imports of Russian crude climbed to a nine-month high of 1.96 million barrels per day in March, up 53% from February, as refiners rushed to lock in discounted barrels under an expiring US sanctions waiver. Russia accounted for roughly 40% of India's crude imports in early April, remaining the top supplier. Iran has come out as India's fourth-largest crude supplier, overtaking the United States.

That window has now closed. US Treasury Secretary Scott Bessent said on 15 April that Washington will not renew licenses for imports of Russian and Iranian oil. The waiver for Russian cargoes has already expired. The Iranian waiver will lapse on 19 April.

Gulf Routes Under Pressure

The Strait of Hormuz, through which a large share of India’s oil usually flows, has been constrained by the ongoing West Asia conflict. Iraqi crude imports collapsed 75% to 240,000 barrels per day by end-March, down from 969,000 barrels per day in February.

Energy trade flows remain uncertain as the situation in the Middle East keeps changing. If conditions do not improve, imports may fall from March levels, said Nikhil Dubey, senior research analyst at Kpler.

Also Read - Logistics IPO Wave Picks Up: What Does The ₹9,000 Crore Pipeline Indicate?

What Comes Next?

Russia accounted for roughly 36% of India's crude imports in both FY24 and FY25. With Russian and Iranian volumes now legally restricted, Indian refiners might possibly turn to Latin America and West Africa.

Brazil, Colombia, Ecuador and Guyana have grown as suppliers, while Nigeria and Angola are additional alternatives. However, longer routes mean higher freight costs and tighter tanker availability.

Sources:

The Economic Times

MSN