India's crude imports from Russia are set to witness a jump in coming months as demand will pick up in the South Asian nation with the onset of the festive season in October, an energy expert has said.
The remarks of Arpit Chandna, a crude analyst linked with Refinitiv, a multinational organization involved in keeping a tab on global oil supplies, come days after India emerged as the top purchaser of Ural blends of crude from the Eurasian nation, data from the London Stock Exchange Group (LSEG) showed.
Overall, the contribution of Russian-origin crude in shipments to India was 74 percent, almost identical to the democratic sovereign state's share in the previous month.
Since May 2023, India's crude acquisitions from Russia have topped two million barrels per day, making Moscow the largest supplier of oil to New Delhi.
Against this background, "discounted Russian oil" is proving to be a boon to the Indian government as it is helping the authorities to keep inflation in check in the country, as per economists.
Arpit stated that India depends on imports to meet more than 80% of its overall crude oil demand and has been utilizing the discounted prices of Urals for shoring up its oil reserves.
"Over the price economics, Russian crude oil import prices are still lower for India if compared with other traditional suppliers such as Iraq & Saudi Arabia. As per ministry data," he noted.
According to him, current global crude oil prices are witnessing headwinds due to a squeeze in supply driven by production cut agreements extended till the end of the year by OPEC & Russia.
Arpit opined that the following is likely to keep the prices edging higher as the demand for oil from the world's second-largest consumer China is witnessing an increase as far as imports are concerned.
He suggested that the scheduled maintenance and planned outages at Indian refineries are among the major factors for lower volumes offloaded in India.
Separately, resurging domestic demand in Russia during summers is also resulting in lower export volumes from Russia available for external markets.
"However, in the coming months, Indian refiners are expected to decrease prices of refined products due to upcoming state elections which is likely to support domestic demand in India. The following would result in a jump in sales of diesel and petrol in the country besides imports by the nation's refiners, including oil acquired from Russia," he asserted.