ONCE RUSSIAN, NOW INDIAN: RUSSIAN DIESEL OUTPUT AMERICAN IN EU

India's imports of Russian oil are growing at the same rate as exports of Indian oil products to Europe. The main refined product destined for the other side of the world remains diesel. Despite tankers being forced to bypass the Red Sea around Africa, diesel purchases by EU countries have increased by 21%. In terms of volume, Indian suppliers have overtaken American ones.

India's clean oil supplies to Europe have risen again. Bloomberg reports, citing Kpler data, that exports rose to 1.5 million barrels per day in September. The agency attributes the increase in supplies of diesel, gasoline and aviation kerosene to the shutdown of some European refineries for preventive maintenance.

Since 2023, after the EU banned the import of oil and oil products from Russia, India has become one of Europe's main fuel suppliers. The country's refineries have not been able to replace Russia on the market, but buying Russian oil at a discount has allowed them to export impressive volumes to EU countries, whose supplies continue to grow.

The main product is diesel. According to the Indian Ministry of Commerce and Industry, diesel exports to the European Union exceeded 69 million barrels in seven months. Most of them were imported from the Netherlands, which is an international center for trading petroleum products. The country accounted for nearly 82% of purchases: 56.5 million barrels. Over the year, the growth was 21%.

France follows, increasing purchases by 1,051% to 8.86 million barrels. Third place is shared by Belgium and Romania - more than one and a half million barrels. The latter resells part of the volumes to Ukraine.

Based on EU consumption volumes in 2022, according to the association FuelsEurope, the share of Indian diesel could be 6-6.5%.

US diesel supplies to Europe are also growing, but they are not keeping pace with Indian ones. According to the US Department of Energy Information, 43.7 million barrels of distillates were supplied to European countries in January-June 2024. The information is published six months in advance, but a month, judging by the dynamics, will not allow American refineries to overtake Indian ones.

The growing export of oil products from India to Europe comes amid growing complexity in delivery. Due to Houthi bombings in the Red Sea and the Gulf of Aden, tankers are taking a longer route, bypassing Africa.

Diesel supplies to Europe brought Indian refiners $6.8 billion in seven months, but that is only 12% more than in January-July 2023. Margins for Indian refiners are falling due to both higher costs and lower discounts on Russian oil and falling fuel prices in Europe.

The main suppliers of Indian diesel to Europe are the private Reliance Industries and Nayara Energy, whose shareholder is Rosneft.

Rising diesel imports into the European Union have stabilized prices in the region. In the first half of September, diesel prices fell to 632 euros per tonne, the lowest level since December 2021, according to the Frankfurt Stock Exchange.

Last year, EU diplomat chief Josep Borrell expressed outrage over increased supplies of Indian oil products from Russia to Europe.