India became the largest buyer of seaborne Russian crude after 2022, taking well over a million barrels a day. This month the traffic ran the other way.

According to ship-tracking data reported by Bloomberg and analysed by the market intelligence firm Kpler, a cargo of roughly 42,000 tonnes of gasoline produced at the Vadinar refinery in Gujarat arrived at a Russian port on 5 August. The refinery is operated by Nayara Energy, in which Russia’s state oil company Rosneft holds a stake — so the fuel was refined at a partly Russian-owned plant in India and then shipped back to Russia.

The route was not direct. The cargo was loaded onto a Russian-flagged tanker in mid-June, carried to Egypt, transferred at sea near the port of Damietta to a vessel flying the Omani flag, and only then delivered to Russia. Kpler’s analysts said the emergence of Indian barrels was particularly notable, and that the routing showed how severely lower refinery runs are reshaping Russia’s traditional trade flows.

The shortage behind it

The cause is Ukraine’s sustained campaign against Russian refineries. Estimates cited by Bloomberg put Russian crude processing at around 3.6 million barrels per day in July — roughly a third below seasonal norms. Ukrainian strikes have continued, with several processors hit in recent weeks.

Moscow’s response has been a series of export bans that would have been unthinkable for one of the world’s largest oil producers three years ago: restrictions on gasoline, then jet fuel, then diesel. The logic is straightforward — with refining capacity down, domestic supply comes first.

It has not been enough. Russia has increased purchases from Belarus and Kazakhstan, and Reuters has reported that Russian oil majors approached Indian counterparts about raising volumes, with deliveries routed through traders. Industry sources have described a target of importing several hundred thousand tonnes of gasoline a month from various countries.

India’s oil minister has said New Delhi does not sell gasoline to Russia directly, while noting that traders could do so.

What it signals

Three things, none of them comfortable for Moscow.

First, the strikes are working in a measurable way. Damage to refineries is harder to conceal than damage to storage, because the shortfall shows up at the pump and in wholesale prices, which have posted their sharpest weekly increases in over a year.

Second, the workarounds are getting expensive. A cargo that loads in Gujarat in June, transfers ship-to-ship off Egypt in July and arrives in Russia in August is not an efficient supply chain. Ship-to-ship transfers exist to obscure origin, and most of the vessels involved in this trade are under EU or US sanctions — the same fleet now at the centre of Putin’s threat to seize European ships.

Third, the dependency has inverted. Russia spent three years building India into its most important oil customer. That relationship now runs in both directions, and the leverage is no longer entirely one-sided.

Sources

Bloomberg, drawing on Kpler ship-tracking data, together with Reuters, The Moscow Times and Meduza.