India’s imports of Russian crude oil are set to reach nearly 1.8 million barrels per day in May, the highest in 10 months, according to ship tracking data from Kpler, as domestic refiners ramp up purchases of lighter Russian grades like ESPO Blend.Strong demand from the world’s third-largest oil consumer is expected to continue into July, with Indian refiners reportedly ordering more than 10 cargoes of June-loading ESPO crude just last week, traders told Reuters.The surge in buying comes ahead of new EU and UK sanctions targeting Russia’s “shadow fleet” of oil tankers and associated financial entities, raising questions about future logistics and pricing.India’s appetite for Russian ESPO crude has also triggered a rebound in spot premiums for shipments delivered to China, the largest buyer of the Far East-exported grade from Russia’s Kozmino port.According to Jay Shah, senior oil analyst at Rystad Energy, shutdowns at crude distillation units at Indian refining majors like Reliance Industries and MRPL have increased the need for light crude feedstock at their fluid catalytic crackers, particularly due to favourable refining margins.Shah also noted that several cargoes arriving at Sikka port, used by Reliance Industries, were part of a long-term agreement with Rosneft, and that volumes through this port have risen since the beginning of the year.One Indian refining source told Reuters, “ESPO oil is available in good quantities in the market. Traders are charging a premium of about 50 cents to Dubai prices.” Another added that ESPO delivered to India is currently priced between 50 cents and $1 per barrel above Dubai crude.More ESPO barrels have reportedly been diverted to India as Chinese state-run firms continue avoiding sanctioned crude, and quota limitations constrain independent refiners in China, according to market analysts.India’s rising demand has helped push ESPO premiums for China even higher, traders said. Offers for July-loading ESPO cargoes bound for China are now around $2 per barrel above Dubai, up from $1.50–$1.70 for June-loading barrels.
