Despite being under a raft of international sanctions, Russia’s oil exports to India surpassed those going to China in July 2023, as Chinese refiners backed away from Russian oil.

Russian crude oil accounted for 44% of India's overall imports in July, according to market data compiled by several US news outlets.

This equates to just over two million barrels a day (mbbl/d), more than 4% higher than the previous month and 12% above the year-ago figure. China's July oil imports from Russia were 1.76mbbl/d.

Meanwhile, Chinese refinery demand for Russian oil has dropped on the back of slowing fuel demand at home.

In the months following its invasion of Ukraine, Russia was placed under an array of stringent economic sanctions.

However, in that time trade between Russia and India has increased, with the Asian nation becoming one of the biggest buyers of Russian oil, as Vladimir Putin sought new markets as imports to the European Union were limited.

In late May, Indian conglomerate Reliance Industries entered into a one-year agreement with Rosneft, securing a monthly purchase of at least three million barrels of Russian oil, payable in roubles, reported Reuters, citing sources.

This move aligns with Putin’s strategy to bypass Western financial systems amid sanctions.

The deal, which commenced at the start of the Indian financial year on 1 April 2024, entails Reliance acquiring two cargoes monthly, each containing approximately one million barrels of Urals crude, the sources said.

Russia has also been using a ‘shadow fleet’ of oil tankers to move and sell oil, bypassing sanctions with often unregistered and uninsured ships.

In May, it was revealed that Russia’s annual oil proceeds almost doubled. Oil-related taxes rose to Rbs632.5bn ($7.1bn), based on Finance Ministry data.

Meanwhile, total oil and gas proceeds increased 39% on the year to Rbs793.7bn, the ministry added.