India Surpasses China as Top Importer of Russian Oil Amid U.S. Sanctions

In July 2024, India became the largest importer of Russian oil, surpassing China. This shift occurred as Chinese refiners reduced purchases due to lower profit margins from fuel production, while India's demand for discounted Russian crude increased. Russian oil accounted for a record 44% of India's total oil imports in July, with imports rising to 2.07 million barrels per day, a 12% increase from the previous year. In contrast, China's imports from Russia decreased by 7.4% over the same period, reaching 1.76 million barrels per day. This change is attributed to weakening processing margins among Chinese refineries and low demand for fuel. India's growing reliance on Russian oil is reshaping global trade flows, as traditional buyers like China reduce their purchases. Additionally, the United States has imposed sanctions targeting Russian oil producers and vessels involved in transporting Russian crude, aiming to reduce Russia's oil revenues. These sanctions have disrupted Russia's oil trade with India and China, leading to higher oil prices and increased freight costs for both countries as they seek alternative sources. The sanctions have also forced vessels carrying Russian oil to divert from their intended destinations, further complicating the global oil trade dynamics. The evolving trade relationships and sanctions underscore the complex interplay between energy markets and international politics, highlighting the need for strategic navigation in this complex environment.