A major reshuffle in Asia’s crude oil flows is underway as Russian tankers that were originally bound for China are now diverting mid-voyage towards India. Fresh vessel-tracking data reported by Bloomberg shows several such diversions in recent weeks, signalling how India has stepped up purchases of discounted Russian oil at a time of global supply disruptions caused by the conflict in the Middle East.
One of the most prominent diversions is that of the tanker Aqua Titan, which is now expected to reach New Mangalore on March 21 carrying Urals crude sourced from a Baltic Sea port. The Aframax vessel had first listed Rizhao in China as its destination but changed course in Southeast Asia around mid-March. The diversion came shortly after the United States allowed India temporary flexibility to scale up Russian oil imports to manage the fallout of the Iran conflict on global supplies.
India outbidding China for discounted Russian crude
It is to be noted here that the redirection of Russian cargoes shows India’s growing dominance in the market for discounted Russian oil. Traders quoted by Bloomberg say shipments originally intended for Chinese refiners are increasingly being picked up by Indian buyers, who are actively re-entering the market to build supply buffers. With West Asian supply routes facing heightened uncertainty, India has been quick to leverage the opportunity.
Indian refiners reportedly secured nearly 30 million barrels of Russian crude in the week following the concession from Washington. At least seven Russia-origin tankers have changed course mid-journey and are now headed to Indian ports, according to data from Vortexa Ltd., reflecting a renewed buying push by all major Indian refining companies.
Strategic buying amid Middle East tensions
The ongoing conflict involving the US, Israel and Iran has intensified volatility in oil shipping routes which has prompted countries across Asia to reassess their energy security strategies. For India, the mix of competitive pricing and geopolitical space to continue Russian purchases has opened a window to strengthen its crude reserves and protect domestic supply chains. As shipping data indicates more diversions, analysts believe the shift could reshape regional crude trade patterns if India continues outbidding China in the coming months.
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