Indian Refiners Pull Back from Russian Crude as SCO Summit Confirms China's Grip on Moscow
Ukrainian strikes have cut Indian intake of Russian crude by roughly 800,000 barrels a day from July highs, reshaping freight and Urals pricing as New Delhi hunts alternative supply.
Indian refiners are on course to take roughly 2 million barrels a day of Russian crude this month, down from a peak of about 2.8 million barrels a day in July, according to Kpler senior modelling manager Sumit Ritolia. Ukrainian attacks on Russian oil infrastructure are behind the drop, forcing processors to seek alternative barrels from West Africa and elsewhere.4
The cutback lands alongside the 25th anniversary Shanghai Cooperation Organisation summit, which opened August 31 (2026-08-31) in Bishkek, Kyrgyzstan. Discussions centred on trade links, digital connectivity and cultural exchange, broadly aimed at countering US global influence, Oilprice.com reported. Russia, China and Iran dominated proceedings. India was present but, as Foreign Policy noted on August 28 (2026-08-28), the China-dominated grouping offers New Delhi few tangible benefits, much as BRICS does.6,5
Russia's total crude exports have also fallen sharply. Bloomberg tanker data showed overseas shipments averaged roughly 3.5 million barrels a day over the four weeks to late August (2026-08-26), down from more than 4 million barrels a day at the July peak. Urals crude was trading at $89.44 per barrel on Wednesday (2026-09-09), against ICE Brent crude front-month at $101.78. That roughly $12 spread is what kept Indian refineries buying; with volumes constrained by supply disruptions, sustaining those flows has become harder regardless of price.4
Russia originally expected India to serve as a partial counterweight to its dependence on China. Foreign Policy reported on May 22 (2026-05-22) that Moscow views the India relationship — economic and political — as a hedge against over-reliance on Beijing. The energy flows tell a different story.2
Russia now imports more than 90% of its sanctioned technology from China, a 10% rise on 2025 levels, Oilprice.com reported. China supplied high-end components later recovered by Ukrainian forces from the battlefield. Moscow's exposure to Beijing runs considerably deeper than technology alone.3
Chinese customs data analysed by the Gaidar Institute shows Beijing saved $2.2 billion on discounted Russian crude in 2025 alone, bringing four-year cumulative savings to nearly $12 billion. An EU official told Oilprice.com those figures undercount actual flows by 30 to 40%, depending on grade. On gas, Russia supplies China through the Power of Siberia pipeline at discounts of up to 45% against what it charges its few remaining European customers.3
China has extracted pricing concessions from Russia that no other buyer has managed. The SCO, far from giving Moscow a multilateral platform to balance that dependency, has functioned mainly as a diplomatic legitimation exercise — one India is increasingly reluctant to invest in for reasons that extend well beyond protocol.5,3
Indian public sentiment reinforces that scepticism. A Pew survey reported by the Economist in May 2026 (2026-05-19) found 67% of Indian respondents held an unfavourable view of China, up from 46% four years earlier. That limits how far New Delhi can deepen cooperation with an organisation whose direction tracks Beijing's priorities.1
India's crude diversification is the clearest market expression of this dynamic. Refiners are actively substituting West African barrels for Russian ones — a shift with direct implications for freight markets, the Urals discount and Russia's foreign-exchange receipts at a moment when Moscow has few alternative buyers with the scale to absorb what India is stepping back from. How quickly West African and Middle Eastern producers can ramp supply into the Indian market, and at what premium to Urals, is the question now sitting in front of crude desks.4