An increase in Iraqi crude volumes this month means that Russian crude may be eclipsed as India’s top source for the first time since October 2022, according to S&P Global Commodities at Sea.
CAS data showed, as of Jan. 22, Iraq exported 1.177 million b/d to India in January compared to 1.089 million b/d of Russian crude.
India’s crude partnership with Russia flourished following Russia’s invasion of Ukraine in February 2022.
However, Russian grades have recently faced greater competition from alternative sources as India commits to diversifying suppliers and favors the cheapest crude grades.
Aside from Iraqi crude, Indian imports from Kuwait are on pace to surge by 167% on the month to 232,000 b/d, according to CAS.
Sour crude from Venezuela averages 133,000 b/d, with the first shipment of Merey-16 since November 2020 scheduled to arrive at the west coast port of Sikka on Feb. 1, CAS data showed.
Fears of shipping disruption in the Red Sea could also be affecting India’s cooling off from Russian crude, market participants said.
“Red Sea issues [are] making Turkey pull much more [Urals],” one trader said.
However, CAS has yet to identify any Russian-loaded crude tanker that rerouted from the Suez Canal to the Cape of Good Hope.
A rerouting of Russian cargoes via the Cape of Good Hope would significantly increase the journey time to India. CAS estimates the Black Sea to India journey time would increase from 25.8 days (2023’s average voyage time) to approximately 35.8 days.
Similarly, cargoes departing the Baltic region would take roughly 44.3 days compared to an average of 33.3 days last year.