India Maintains Near-Record Russian Oil Imports Despite US Sanctions

The Government of India maintained Russian crude oil imports at near-record levels in July, averaging 2.45 million barrels per day. This follows a peak of 2.64 million barrels per day in June. The surge in imports was triggered by the closure of the Strait of Hormuz after U.S. and Israeli attacks on Iran in late February, as well as the collapse of a US-Iran peace deal that led to a US naval blockade and renewed Iranian attacks on shipping.

To support these imports and stabilize its exchange rate, India paid approximately $14.6 billion in rupees for shipments between March and May. While the United States issued a series of sanctions waivers from March 12 to May 17 to facilitate trade, the final waiver expired on June 17. Despite this, shipments continue to flow via middlemen and pre-arranged cargoes. Russia has surpassed the United Arab Emirates and Saudi Arabia to become India's largest oil supplier.

Russian exports to India have also been bolstered by Ukrainian drone attacks on domestic Russian facilities, including the Yanos refinery in Yaroslavl, which forced Russia to divert crude oil overseas. Meanwhile, the United States Senate is considering a bipartisan bill that would impose tariffs up to 100% on the top five purchasers of Russian oil. To maintain their positions as India's second and third largest suppliers, the United Arab Emirates and Saudi Arabia are utilizing shipping workarounds, such as the Yanbu export port and pipelines to Fujairah, to bypass the Hormuz crisis.