Israel-Iran conflict effect? India ramps up crude oil imports from Russia, US in June 2025

Mint

22-06-2025

India has increased its crude oil purchases from Russia and the United States in June 2025, as the import volumes from the two nations exceed the combined volumes from Middle Eastern suppliers amid the market volatility due to the Israel-Iran conflict, reported the news agency PTI.
India's primary suppliers for crude oil in the Middle East are nations like Saudi Arabia and Iraq. This comes amid US President Donald Trump's announcement that America had carried out coordinated airstrikes targeting three nuclear facilities in Iran.
Indian refiners are expected to import 2 million to 2.2 million barrels of crude oil per day in June 2025, marking the highest level of russian oil imports in the last two years, according to the agency report citing Kpler data. The crude oil imports from Russia were at 1.96 million barrels per day in May 2025.
This expected hike in volumes is also set to beat the total volumes bought from Gulf nations like Iraq, Saudi Arabia, the UAE and Kuwait, as per the report.
On the crude imports on the US front, Indian refiners' crude oil imports from the United States' also jumped to 4,39,000 barrels per day in June 2025, compared to their 2,80,000 barrels per day levels in the previous month.
The data report also showed how the full-month projects from crude oil imports from the Middle East into India stood at 2 million barrels per day, lower than the May 2025 levels, according to the agency report.
India started importing cheaper oil from Russia soon after the Russia-Ukraine war in February 2022 due to the higher discounted rates post the economic sanctions from the United States.
India buys nearly 5.1 million barrels of crude oil, which is then refined to be converted into fossil fuels like petrol and diesel
However, so far in the Israel-Iran conflict, there have been no crude oil supply cuts or disruptions in the oil trade, which can potentially drive up oil prices around the world.
'While supplies remain unaffected so far, vessel activity suggests a decline in crude loadings from the Middle East in the coming days,' Sumit Ritolia, Lead Research Analyst, Refining & Modeling at Kpler, told the news agency.
'Shipowners are hesitant to send empty tankers (ballasters) into the Gulf, with the number of such vessels dropping from 69 to just 40, and (Middle East and Gulf) MEG-bound signals from the Gulf of Oman halving,' he said.
The global situation of uncertainty caused by the raging Israel-Iran war now risks Tehran retaliating by closing the Strait of Hormuz. The Strait of Hormuz is a strategically important trade passage for global crude oil as the strait links the Gulf of Oman, the Arabian Sea, and the Persian Gulf.
According to multiple media reports, the Strait of Hormuz handles nearly a quarter of the world's oil trade. Hence, any potential move to close the passage will result in the escalation of the already raging war.
Experts cited in media reports indicate that if there is an oil supply disruption, crude prices can jump to $400 per barrel. 'Yet, Kpler analysis assigns a very low probability to a full blockade, citing strong disincentives for Iran,' Ritolia told the news agency.
The route serves as a major route for world oil and LNG export transit, and agency reports show that India imports nearly 40 per cent of all its crude oil and nearly 50 per cent of its gas imports from the Strait of Hormuz, which links to many Gulf nations.
The Kpler data cited in the agency report also estimates that in case any disruption happens, it will result in 24 to 48 hours of isolation before major nations like the US step in to counter the retaliation.
Meanwhile, the agency also highlighted that Russian oil imports are detached from Hormuz and are imported via the Suez Canal, Cape of Good Hope, or the Pacific Ocean.
'If conflict deepens or there is any short-term disruption in Hormuz, Russian barrels will rise in share, offering both physical availability and pricing relief. India may pivot harder toward the US, Nigeria, Angola, and Brazil, albeit at higher freight costs,' said the expert cited in the agency report.
As of 19 June 2025, Russian crude oil accounted for 35 per cent of India's total crude imports. The Indian refiners are watching the geopolitical landscape and are likely to adjust procurement strategies to prioritise energy security, supply stability, and commercial viability if risks in the Middle East escalate, according to the agency report.