In September, India experienced a significant increase in oil imports from West Asia, with Gulf suppliers utilizing ship-to-ship (STS) transfers to navigate the challenging waters of the Strait of Hormuz, according to preliminary tanker data.
Conversely, oil imports from Russia, India’s primary supplier, fell for the second consecutive month. This decline is attributed to heightened competition from Chinese refiners and restricted availability of Russian crude due to ongoing Ukrainian attacks on Russia’s energy infrastructure, as reported by industry experts and analysts.
With the conflict in the region ongoing, the enhanced availability of oil from West Asia provides some relief for India, especially amid pressure from the United States on major purchasers of Russian oil. While India maintains that its main focus is to satisfy the energy requirements of its 1.4 billion citizens through a diversified approach, the new sanctions law targeting Russia and Iran enacted by the US adds uncertainty regarding future oil imports from Russia.
The legislation, known as the Lindsey O Graham Sanctioning Russia and Iran Act, grants the US President the authority to impose tariffs up to 100% on the largest importers of Russian oil, with China and India being the foremost on the list.
As New Delhi continues discussions with Washington regarding the implications of this law, analysts suggest that Indian refiners would be wise to gradually decrease their dependence on Russian crude and enhance the diversification of their oil supply sources.
Nikhil Dubey, a lead analyst at the commodity market analytics firm Kpler, stated, “In the future, improved availability of Middle Eastern oil could drive Indian refiners to favor these sources, particularly given the geopolitical uncertainties surrounding the Graham Act.”
According to vessel tracking data from Kpler, India’s oil imports from Russia dropped nearly 9% in September to 1.9 million barrels per day (bpd), down from 2.1 million bpd in August. This follows a record high of 2.8 million bpd in July, with September’s figures marking a five-month low while still comprising over 35% of India’s total oil imports for the month.
The decline in Russian oil imports was offset by a significant increase in shipments from countries such as Iraq, Saudi Arabia, Kuwait, and Qatar. Imports from Iraq surged by 238.2% in September to over 551,000 bpd, while Saudi Arabian imports rose by 56.2% to nearly 543,000 bpd. Additionally, Kuwaiti oil imports increased by 104.4% to approximately 317,000 tonnes.
Qatar, which had no oil imports in August, recorded nearly 110,000 bpd in September. Among West Asian suppliers, only the UAE experienced a decrease, with imports down 15.8% to around 460,000 bpd.
Prior to the outbreak of the conflict in February, oil imports from these five West Asian suppliers were around 3 million bpd. Cumulative volumes in September were down 33% to 2 million bpd, with their share of India’s oil imports rising to 36.7% in September from 26% in August, though still significantly less than February’s 56.3%.
Countries like Iraq, Kuwait, and Qatar are particularly reliant on the Strait of Hormuz for their oil exports. In contrast, Saudi Arabia and the UAE have pipeline systems that circumvent this critical chokepoint, although a substantial portion of their oil has traditionally passed through the strait. The rise in export volumes from within the Strait of Hormuz is primarily attributed to STS operations, according to trade sources.
STS transfers differ from standard operations where oil is directly loaded onto tankers headed for the destination port. In STS operations, a shuttle tanker transports the oil partway before transferring the cargo to another vessel.
Typically, the supplier assumes the responsibility and risk of navigating through the Strait of Hormuz, with a tanker positioned in safer waters subsequently taking the oil to its final destination.
This arrangement has effectively shifted the risk away from buyers, who previously needed to charter ships to enter the Persian Gulf for oil retrieval. Currently, Iran has not successfully disrupted this STS process, which appears to be receiving protection from the US Navy.
The pressures on Russian crude exports are significantly influenced by Ukrainian attacks targeting Russia’s oil and gas infrastructure, as strikes on export facilities in the Black Sea pose a tangible risk to energy tankers operating in the vicinity.
Freight economics have further incentivized avoidance of Black Sea routes altogether. Additionally, competition for Russian oil from China has intensified due to various factors, including a decrease in Russian oil exports as Moscow prioritizes domestic refinery production to satisfy its own fuel needs amid ongoing attacks on its energy infrastructure, as well as a reduction in Iranian oil supplies available to Chinese refiners because of the situation in the Strait of Hormuz.
Since March 2026, India’s crude import strategy has transformed significantly, as disruptions in the Strait of Hormuz have tightened West Asian oil flows and increased freight risks. While Russian crude remains a crucial component of India’s import strategy, refiners have aggressively diversified their sources to include barrels from Africa, North America, and South America to compensate for diminished supplies from the Gulf.
Traditionally, approximately 40% of India’s crude imports have come through the Strait of Hormuz, but a substantial portion of this supply has been offline for the preceding six months.
Sukalp Sharma serves as a Deputy Associate Editor at The Indian Express, covering a wide range of topics including energy and aviation. With over 16 years in journalism, he has reported on various subjects such as politics, development, equity markets, corporate affairs, trade, and economic policy. He is also an avid photographer who enjoys traveling.
