India's crude oil imports have largely recovered to pre-conflict levels despite months of disruptions in West Asia, with refiners successfully diversifying supplies by increasing purchases from Russia, the United States, Oman, West Africa and South America, according to an HSBC Global Research report. After experiencing a dip in March, Indian crude imports have broadly returned to pre-conflict levels as refiners replaced West Asia supplies with alternatives from these regions. The report highlights that Indian refiners have adapted quickly to supply disruptions caused by the Strait of Hormuz crisis by sourcing crude from alternative producers instead of relying heavily on Gulf supplies. This diversified sourcing strategy has been instrumental in maintaining crude supplies without significant disruption, reducing dependence on Gulf producers during the crisis. Latest reports indicate that Indian refiners have already secured crude supplies through mid-August 2026, with ample stocks available and more barrels expected from Saudi Arabia, the UAE and Iraq as these producers push more crude into the market.
Russia continues to remain an attractive supplier for Indian refiners as its crude is competitively priced, with Russian oil trading at a small discount to Brent, making it attractive to Indian refiners. The report adds that Russian export availability has improved after Ukrainian attacks on Russian refineries curtailed domestic processing, allowing more crude to reach export markets. Latest data shows that Russian imports climbed to around 2.6 million barrels per day in June 2026, reinforcing Russia's position as India's largest supplier. This pricing advantage has enabled Indian refiners to secure competitively priced crude while maintaining supply stability during the crisis period. The diversified sourcing approach has been particularly effective in maintaining supply security during the West Asia conflict.
India's strategic infrastructure investments over the past decade have significantly enhanced its energy security capabilities. The country's LPG import terminals have increased from 11 in 2014 to 22 currently, while import capacity has expanded to 32.3 million tonnes per annum in 2026 compared to 12 mmtpa in 2014. Crude sourcing has been expanded to 41 countries in 2026 against 27 in 2014, with newer suppliers including Libya, Gabon, Equatorial Guinea and Guyana added to the portfolio. The government's demand-management efforts, including allowing public sector marketing companies to absorb costs rather than passing them to households, helped maintain fuel supplies during the crisis. While Gulf oil exports are recovering following the reopening of the Strait of Hormuz, HSBC does not expect Asian refiners, including those in India, to significantly increase purchases from the region in the near term.
The reopening of the Strait of Hormuz has created a temporary oversupply of West Asian crude in global markets as stranded cargoes are being released faster than refiners can absorb them. However, HSBC expects this 'mini-glut' to fade over the coming weeks as inventories are rebuilt and strategic petroleum reserve releases come to an end. Latest market indicators suggest this is already happening, with sources noting that there is ample crude oil in the market currently as the de-escalation in West Asian conflict and more Middle Eastern cargos hit the market. The diversified sourcing strategy has helped India maintain crude supplies without significant disruption, reducing dependence on Gulf producers during the crisis. As Gulf markets stabilise, India is expected to continue balancing imports across multiple suppliers based on price competitiveness and geopolitical risks. With crude prices now easing and the Strait reopening, retail prices are expected to soften in the coming months, providing relief to consumers after the recent price increases.
