India’s Oil Pivot Sets Up Fresh Competition With Asian Buyers For Atlantic Crude

Indian crude oil import volumes have bounced back to near pre-conflict levels, with refiners ramping up their imports from Russia and other Atlantic Basin source countries after the disruptions in Middle Eastern supply lines, according to a report by HSBC Global Research.

The change reflects India’s increasing capacity to diversify its sources of crude oil during any geopolitical crisis, particularly when it comes to imports coming from the Middle East via the Strait of Hormuz, one of the world’s busiest oil shipping lanes. The approach has enabled refiners to not just ensure supply but also manage price volatility and geopolitical risks.

According to the HSBC report, cited by ANI, Indian refiners turned to alternative suppliers after crude imports dipped in March, when disruptions linked to tensions around the Strait of Hormuz affected Gulf supply routes. Russia, the United States, Oman, West Africa and South America emerged as key replacement sources.

Separate trade data showed India’s crude oil imports rose to around 4.9 million barrels per day in May, an 8.89% increase from roughly 4.5 million barrels per day in March and April. Imports, however, remained below the approximately 5.2 million barrels per day recorded in February.

Russia Retains Pricing Advantage

HSBC said Russia continued to be an attractive supplier for Indian refiners because of competitive pricing and improved export availability.

“Russian oil is trading at a small discount to Brent, making it attractive to Indian refiners,” the report said. It added that Russian crude exports increased after Ukrainian attacks on Russian refineries reduced domestic processing, leaving more crude available for overseas buyers.

Market analysts separately said India’s continued purchases of Russian crude have helped reduce its exposure to supply disruptions around the Strait of Hormuz while limiting dependence on higher-priced Atlantic Basin cargoes.

At the same time, the country’s ability to source discounted Russian barrels alongside crude from other regions has allowed refiners to maintain stable import volumes despite uncertainty in the Middle East, the HSBC report noted.

Gulf Imports Unlikely to Rebound Quickly

Although oil exports from the Gulf have begun recovering following the reopening of the Strait of Hormuz, HSBC said it does not expect Asian refiners, including those in India, to significantly increase purchases from the region in the near term.

The report said many refiners across Asia have already secured cargoes for July and August while scheduled refinery maintenance is expected to limit demand for additional spot purchases.

HSBC also said Indian refiners remain cautious about resuming purchases of Iranian crude despite a temporary easing of U.S. sanctions. According to the report, refiners are unlikely to increase imports unless U.S. sanctions waivers are extended beyond August.

Competition for Atlantic Basin Supplies Intensifies

India is not the only country seeking alternatives to Middle Eastern crude. According to the International Energy Agency’s May 2026 Oil Market Report, Atlantic Basin crude exports have increased by 3.5 million barrels per day since February, driven by higher shipments from the United States, Brazil, Canada, Kazakhstan and Venezuela to buyers east of the Suez Canal.

The shift has intensified competition for non-Gulf supplies across Asia. Japanese refiners purchased at least 13 million barrels of U.S. West Texas Intermediate and Mars crude for April loading, a volume that could mark a monthly record. Thailand’s PTT purchased North Sea Forties and Angolan crude for March loading, while South Korea’s GS Caltex bought two April-loading cargoes of Kazakhstan’s CPC Blend.

Chinese refiners also increased purchases, ordering at least 9 million barrels of April-loading West African crude in addition to contracted volumes while continuing to buy Brazilian crude for March and April deliveries.

Asian buyers also competed more aggressively for Russian crude during the first quarter of 2026 as Middle Eastern cargo availability tightened. Russian crude prices averaged $0.526 per kilogram during the quarter, up 16.4% from the previous quarter.

Outlook Tied to Hormuz Recovery Pace

HSBC said the current increase in redirected crude supplies is likely to ease in the coming weeks as inventories are rebuilt and strategic petroleum reserve releases conclude.

As Gulf supply routes stabilize, Indian refiners are expected to continue balancing imports among Russia, the Middle East and Atlantic Basin producers, with purchasing decisions likely to remain driven by pricing, freight economics and geopolitical risks.