Media365
India’s crude oil imports have rebounded to pre-conflict levels as refiners successfully diversified sourcing during months of supply disruptions in the Middle East, according to a report by HSBC Global Research.
The report said Indian refiners swiftly adjusted procurement strategies following disruptions linked to the Strait of Hormuz, replacing a significant portion of Middle Eastern crude with supplies from Russia, the United States, Oman, West Africa and South America.
“After a dip in March, Indian crude imports have broadly returned to pre-conflict levels as refiners replaced Middle East supplies with alternatives from Russia, the US, Oman, West Africa and South America,” HSBC said.
The report highlighted that Russia continues to remain a preferred supplier for Indian refiners due to its competitive pricing. Russian crude is currently trading at a slight discount to Brent crude, making it an economically attractive option even as Gulf oil exports gradually recover.
Despite the reopening of the Strait of Hormuz and the resumption of normal export flows from the Gulf, HSBC does not expect Asian refiners, including those in India, to sharply increase purchases from the region in the near term.
The report noted that most refiners have already secured cargoes for July and August while several facilities are entering scheduled maintenance, limiting demand for additional spot cargoes from Middle Eastern producers.
HSBC also pointed to India’s cautious stance on Iranian crude despite temporary easing of US sanctions. According to the report, Indian refiners are unlikely to resume significant purchases from Iran unless sanctions waivers are extended beyond August, reflecting continued regulatory and geopolitical uncertainty.
The reopening of the Strait of Hormuz has also resulted in a temporary oversupply of Middle Eastern crude in global markets, HSBC said. Cargoes that were delayed during the disruption are now reaching buyers at a faster pace than refiners can absorb them, creating what the report described as a short-lived “mini-glut.”
However, HSBC expects this temporary oversupply to ease over the coming weeks as inventories normalise and strategic petroleum reserve releases taper off.
The report said India’s diversified sourcing strategy has strengthened the country’s energy security by reducing dependence on Gulf producers during the period of heightened geopolitical tensions. Access to discounted Russian crude along with increased imports from Atlantic Basin suppliers enabled refiners to maintain stable crude supplies without significant disruption.
Going forward, HSBC expects Indian refiners to continue balancing crude purchases across multiple suppliers, prioritising price competitiveness, supply security and geopolitical stability rather than relying heavily on any single region.
