Imports of Russian oil to India are growing at the same rate as exports of Indian petroleum products to Europe. The main refined product that goes to another part of the world continues to be diesel fuel. Despite oil tankers being forced to go around Africa through the Red Sea, diesel purchases by EU countries increased by 21%. In terms of volumes, Indian suppliers have surpassed American ones.
The supply of clean oil products from India to Europe has increased again. Bloomberg reports, citing Kpler data, that exports rose to 1.5 million barrels per day in September. The agency attributes the increase in supplies of diesel, diesel fuel and aviation kerosene to the closure of some European refineries for preventive maintenance.
Since 2023, after the EU banned the import of oil and oil products from Russia, India has become one of Europe’s largest fuel suppliers. The country’s refiners have not been able to replace Russia in the market, but buying discounted Russian oil has allowed them to export impressive volumes to EU countries, whose supply continues to increase.
The main product is diesel fuel. According to India’s Ministry of Commerce and Industry, diesel exports to the European Union exceeded 69 million barrels in seven months. Most of it was imported from the Netherlands, which is an international center for the trade of petroleum products. The country accounted for almost 82% of the purchases: 56.5 million barrels. During the year the growth was 21%.
Then comes France, which increased its purchases by 1,051%, up to 8.86 million barrels. Third place is shared by Belgium and Romania: more than one and a half million barrels. The latter resells part of the volumes to Ukraine.
Based on consumption volumes in the EU in 2022, according to the FuelsEurope association, the share of Indian diesel could be 6-6.5%.
US diesel supplies to Europe are also growing, but cannot keep pace with those from India. According to the United States Energy Information Administration, between January and June 2024, 43.7 million barrels of distillates were supplied to European countries. The information is published six months in advance, but one month, judging by the dynamics, will not allow American refineries to overtake Indian ones.
The growing export of petroleum products from India to Europe occurs in a context of increasing complexity in their delivery. Due to Houthi bombings in the Red Sea and Gulf of Aden, oil tankers are taking a longer route, avoiding Africa.
Diesel supplies to Europe brought Indian refineries $6.8 billion in seven months. However, this is only 12% more than in January-July 2023. Margins at Indian refineries are declining due to both rising costs and lower discounts on Russian oil and lower fuel prices in Europe .
The main suppliers of Indian diesel to Europe are private companies Reliance Industries and Nayara Energy, whose shareholder is Rosneft.
Increased diesel imports to the European Union have stabilized prices in the region. In the first half of September, the price of diesel fell to 632 euros per ton, the lowest level since December 2021, according to the Frankfurt Stock Exchange.
Last year, the head of EU diplomacy was outraged by the increase in supplies of Indian petroleum products from Russian oil to Europe. Josep Borrell. However, this does not violate sanctions and the threats remained just threats.
