Europe is still using Russian crude oil months after it stopped importing any seaborne crude oil imports from the country. According to a Bloomberg report, Russian crude is finding its way to European countries in the form of refined fuel shipped from India. In December last year, the European Union prohibited almost all seaborne crude oil imports from Russia, and two months later, the prohibition was extended to refined fuels.
Nonetheless, the regulations did not stop nations such as India from purchasing cheap Russian crude, refining it into products like diesel, and reselling it to Europe at a higher price. According to data compiled by Bloomberg from analytics firm Kpler, India is on track to become Europe’s largest supplier of refined fuels this month while simultaneously buying record amounts of Russian crude.
“Russian oil is finding its way back into Europe despite all the sanctioning and India ramping up fuel exports to the West is a good example of it. With India taking in so many Russian barrels, it’s inevitable,” said Viktor Katona, lead crude analyst at Kpler.
According to Kpler’s data, Europe’s refined fuel imports from India are set to surge above 360,000 barrels a day, edging just ahead of those of Saudi Arabia, Russian crude oil arrivals to India are expected to surpass 2 million barrels a day in April, representing almost 44 per cent of the nation’s overall oil imports.
The report notes that prior to the European Union’s decision to stop oil purchases in response to Russia’s invasion of Ukraine in early 2022, over 50 per cent of Russia’s oil transported by sea was delivered to the European Union and G7 nations.
On the other hand, India imported less than 0.2 per cent of its total oil shipments from Russia before the start of the Russia-Ukraine war last year.
It was previously reported that according to energy cargo tracker Vortexa, Russia continued to be the single largest supplier of crude oil for a fifth straight month in February by supplying over one-third of all oil India imported. The number went as high as 1.6 million barrels per day. This is more than what Indian imports from its traditional suppliers, Saudi Arabia and Iraq combined.
Also Read: India’s Russian Crude Oil Import Reaches 1.6 Mn Barrels A Day In Feb, More Than Saudi, Iraq Combined
The report says the current situation has both positive and negative implications for the EU. On one hand, it must seek alternative sources of diesel since it has stopped purchasing directly from Russia, which was previously its primary supplier. On the other hand, this increases the demand for Russian oil, resulting in additional freight costs. Furthermore, European oil refiners who cannot access inexpensive Russian crude now face more competition.