India and China Shift Crude Procurement Away From Middle East

Indian Refineries Turn to Latin America and Africa Amid Hormuz Disruptions

Indian refineries have increased their search for alternative oil suppliers as transit through the Persian Gulf faces restrictions. Indian import volumes from Middle Eastern producers dropped approximately 27% during the April-to-June quarter, falling to 1.55 million barrels per day. The decline coincides with disrupted maritime flows through the Strait of Hormuz following heightened military escalations involving the United States, Israel, and Iran.

To compensate for the shortfall in Gulf supplies, refineries have expanded their geographic footprint. Executives from Indian energy firms confirmed that procurement teams are testing and acquiring heavy crudes from new regional sources. As detailed by Primicia, state-owned Bharat Petro reported diversification efforts outside traditional Middle Eastern corridors.

Global energy markets experienced heightened nervousness following attacks by Houthi rebels against Saudi vessels in the region.

Vikas Kaushal, managing director of Hindustan Petroleum Corporation, stated that they had to make decisions based on availability rather than optimization, adding that at the beginning of the year they always make a combination of forward and spot contracts.

China Accelerates Purchases of Russian Crude to Insulate Against Supply Shocks

While Indian refineries branch out toward Latin America and West Africa, Chinese refineries are leaning on Russian and Iranian barrels. This purchasing wave is paired with interest in Iranian supplies as part of a strategy to mitigate Middle Eastern volatility.

The geopolitical friction has introduced logistical bottlenecks across global trade lanes. With traffic disrupted through the Strait of Hormuz—a transit corridor for approximately 20% of global oil supply—and persistent threats near the Bab el-Mandeb strait, benchmark Brent crude climbed back to 100 dollars per barrel, as noted by Vietnam.vn.

Under normal circumstances, refineries wait until delivery deadlines approach. However, Chinese operators finalized their ESPO crude purchases in advance to secure supply. Short transit times from the port of Kozmino to China’s eastern coast make Russian oil an attractive alternative against maritime insecurity in the Middle East.

Shifting Import Baskets and Disparate Regional Pressures

The tactical pivot away from the Persian Gulf has altered national import baskets across Asia. India’s imports from the Commonwealth of Independent States—including Russia—surged 8.3% to reach 2.26 million barrels per day between April and June. Russian crude reached 2.64 million barrels per day in recent tracking, accounting for roughly half of India’s total 5.24 million barrels per day imported.

This market fragmentation creates asymmetric pressures globally. While Asian refineries absorb discounted barrels subject to Western sanctions, European and North American industrial hubs face constrained supply options and higher operational costs.

Whether these alternative trade routes become permanent fixtures of the global energy architecture depends on the stability of key maritime chokepoints. With regional tensions continuing, buyers in New Delhi and Beijing are prioritizing security of supply over traditional supply optimization.