India's January oil imports hit record high on Red Sea delays, trade data shows

New Delhi: India's crude oil imports rose to a monthly record in January after the Red Sea shipping crisis delayed the December arrival of cargoes from the Americas, data from trade sources showed.

The world's third largest oil importer and consumer also received in January its first cargo of Venezuelan oil after a gap of more than three years, as the US eased sanctions on the South American producer, the data showed.

India's oil imports hit 5.24 million barrels per day (bpd) in January, up 17% from December and 3.5% higher than in the corresponding month a year earlier, according to the data.

The previous monthly high in India's imports was 5.1 million bpd in Jan 2018, the data showed.

The trade estimates are higher than Thursday's preliminary data from the oil ministry showing India's January oil imports at a 21-month high of 21.39 million metric tons (5.1 million bpd).

"Some U.S. and Latin American oil cargoes were delayed as they had been diverted to an alternative route around the Cape of Good Hope after the Red Sea crisis and those cargoes landed in late December or January," said LSEG analyst Ehsan Ul Haq.

An official with one Indian refiner confirmed that some cargoes it was scheduled to receive in December had been delayed until January.

Even though long-haul crude cargoes, mainly from the Americas, are purchased on a delivered basis, Indian buyers had to pay extra charges as sellers invoked a force majeure clause after freight and insurance costs jumped due to the Red Sea troubles, said the source, who spoke on condition of anonymity.

India's Russian oil imports in January rebounded from December to 1.47 million bpd, posting growth of 10.8% but Russia's share of the total declined to 28% from 30%, while Latin America's share rose to about 8% from 6%, the data showed.

Indian refiners turned to nearby suppliers in the Middle East to avoid disruption from the delays and make up for the diversion of Russian light sweet Sokol oil, supplies of which were hit by payment woes and tougher Western sanctions.

Top refiner Indian Oil Corp, a key buyer of Russian Sokol oil, had to draw from its inventories to make up for the shortfall.

January imports from Iraq surged to the highest since August 2019, raising the share of Middle Eastern oil in India's overall imports to 54%, from 48% in December 2023, the data showed.

The rise in Middle East imports lifted OPEC's share in India's intake to about 54% in January, although the average is at its lowest on a financial-year basis.