India’s purchases of Venezuelan crude are set for a massive jump in October, with attractive discounts prompting refiners to increase shipments even as Russian oil becomes more expensive. Imports from Venezuela could reach their highest level in nearly seven years, highlighting a shift in India’s crude sourcing strategy. Shipments of Venezuelan crude to India are estimated to rise to around 465,000 barrels per day this month, more than twice the approximately 196,000 barrels per day recorded in September, according to Kpler data.
So, if scheduled cargoes arrive as planned, October volumes would represent the strongest monthly inflow since December 2019.
The increase comes as Indian refiners look for competitively priced alternatives amid changing economics around Russian crude and growing geopolitical risks affecting energy trade.
All Venezuelan crude cargoes currently headed for India have Sikka listed as their destination, according to ship-tracking data. Sikka is the port serving Reliance Industries’ Jamnagar refinery complex in Gujarat, which is the world’s largest refining complex.
The actual volume received during October could, however, be lower than the scheduled figure. Kpler data shows that at least two tankers are due to reach India’s western coast on October 31, meaning their cargoes may not be discharged within the month.
Venezuela Crude Gets Price Advantage Over Russian Oil
India’s renewed interest in Venezuelan crude comes as the price gap between the two sources widens. Merey, Venezuela’s key crude grade, is currently being sold at a discount, while Russia’s Urals is trading at a premium before freight and other transportation costs are factored in.
That discount can make Venezuelan crude economically attractive despite the longer voyage to India. It also provides Indian refiners with an opportunity to diversify their supply basket at a time when Russian crude purchases are facing greater pressure.
“Venezuelan crude has become an increasingly important part of India’s diversification since the start of the year,” said Sumit Ritolia, senior manager of modeling at Kpler.
However, Ritolia expects actual October deliveries to be closer to 350,000 barrels per day because some tankers may not discharge their cargoes before the end of the month.
Russian Oil Share In India’s Imports Falls
India had resumed imports of Venezuelan crude in February after an almost year-long break. The return of Venezuelan supplies followed the easing of US sanctions after the ouster of former Venezuelan leader Nicolás Maduro, which helped facilitate the revival of crude flows.
At the same time, India’s purchases of Russian oil have been losing momentum. Russia remains India’s largest crude supplier, but higher prices and mounting geopolitical pressure have altered the buying landscape.
The share of Russian crude in India’s overall imports declined to around 35 per cent in September, compared with as much as 56 per cent in July, Kpler data showed.
Indian refiners have also reduced their dependence on Russian supplies following the introduction of a broad US sanctions law that increased the risk of additional punitive tariffs.
Heavy Venezuelan Crude Poses Refining Challenge
Price is not the only factor Indian refiners must consider. Venezuelan Merey is a dense, high-sulfur crude that requires suitable refinery configurations for efficient processing.
Reliance’s Jamnagar complex is among the facilities capable of handling such heavy grades, giving the company greater flexibility to take advantage of discounted Venezuelan barrels.
“These barrels are relatively difficult, heavy barrels, and not every Indian refinery can process them continuously or in large proportions,” he said.
