Ever since the Ukraine war started, India has defied the US and its European allies to buy oil from Russia at discounted rates, for keeping prices stable despite inflation. Although European nations have cut off the direct inflow of oil from Russia, the country's crude is being refined into aviation fuel and diesel in India, before being exported to Europe.
Using discounted Russian crude to fill the gap by absence of Russia's oil, India has surpassed Saudi as the top supplier of refined fuels to Europe.
Funneling Russian crude back to Europe
Currently Indian refiners are sending 3.6 lakh barrels of refined fuel to Europe according to Kpler, and regional refiners are lagging behind since they don't have access to Russian oil.
India's refineries are fuelled by 20 lakh barrels of Russian crude arriving every day in the country, which has also refused to agree with western price caps on the same.
Although Iraq also supplied discounted oil to India, Russia surpassed it by November 2022, to account for 44 per cent of crude coming into the country.
Opportunity in a crisis
Although Indian refiners rarely bought Russian crude before the war, they also started importing lighter far east and Arctic grade oil from the country, apart from its flagship Ural grade oil.
With this supply, India's export of refined fuel diesel to European markets went up by as much as 16 per cent in FY23.
