Indian refiners have enough crude to last them two months, so they will not be scrambling to buy Middle Eastern cargoes expected to be coming out through the reopened Strait of Hormuz anytime soon.
According to a Bloomberg report, however, Middle Eastern producers have approached Indian buyers to start taking in volumes under long-term contracts. The buyers are not eager to do so, unnamed sources told the publication. The Indian government is yet to give the green light to Indian tankers setting off for the Persian Gulf to load the long-term contract volumes.
India was among the biggest buyers of Middle Eastern crude due to the favorable price context related to the geographical proximity of the two. This, however, made it also among those most vulnerable to the fallout of tanker traffic disruption. As a result, Indian refiners returned to Russian oil, not least thanks to a sanction waiver from Washington, which put the squeeze on Russian flows overseas last autumn with sanctions on the two biggest exporters.
Even with alternative sources of crude, India’s imports of oil and LNG jumped in May from April, as arrivals of non-Middle Eastern cargoes accelerated, and the country’s energy import bill soared by nearly 82% from a year earlier amid higher energy prices.
India’s crude oil imports rose by 7.5%, and LNG imports jumped by 16% in May from the previous month, according to provisional data from the oil ministry compiled by Indian media. The country paid as much as $18.7 billion on oil and gas imports in May, up by 81.6% compared to the May 2025 energy import bill of $10.3 billion, the data showed.
To tackle the supply squeeze, the government advised energy conservation, and to help energy companies make it through the crisis, it allowed them to raise retail fuel prices for the first time in years. Indian drivers saw a total of four price hikes at the pump over a month.
By Irina Slav for Oilprice.com
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