India and China have been taking different approaches to mitigate short-term crude oil supply disruptions, Vortexa said in a report.
Vortexa flow data revealed that, since January 10, when the US Office of Foreign Assets Control (OFAC) sanctioned over 100 tankers involved in Russian oil trade, there have been changes in crude oil export flows from major producing regions to India and China.
The combined crude exports from Russia to India and China have decreased since January 10, even when accounting for seasonal variations, according to the ship-tracking agency.
Exports from West Africa and the Middle East have increased, however, other Atlantic Basin producers have not shown any indication of increasing exports to India or China at this time, Jay Maroo, head of market intelligence, Middle East and North Africa, Vortexa, said.
Source: Vortexa
Change in export patterns
Russian-origin crude exports have fallen by approximately 450,000 barrels per day since sanctions were implemented on January 10, compared to the average export volumes throughout 2024, Vortexa data showed.
Meanwhile, exports from the Middle East (excluding Iran) have increased by 200,000 barrels per day.
However, the most significant increase in exports has come from West Africa, which has risen sharply in recent weeks by about twice the amount as Middle Eastern flows.
“The strong uptick in West Africa exports is also motivated by wide Brent-Dubai spreads, which make West African crudes (priced against Brent) relatively cheap in comparison to Middle East grades,” Maroo said in the report.
Africa ramps up exports
“Within West Africa, a closer look reveals that the main driver of this increase is rising exports from Angola to China,” Maroo added.
Exports to Atlantic Basin buyers (Spain, Netherlands, Italy, and Brazil) have been limited as a result of post-sanctions exports (10-Jan to 28-Feb) exceeding 700,000 barrels a day to China, Vortexa estimates showed.
While China has historically been a major importer of Angolan crude oil, India has not traditionally been a significant purchaser.
However, this trend appears to be changing.
Recent data indicates that India’s imports of Angolan crude oil increased on a month-over-month basis in February.
This increase in Angolan crude exports to India was accompanied by a similar rise in exports from the Republic of Congo and Cameroon, suggesting a broader trend of increased Indian interest in crude oil from Central and West African sources.
Middle Eastern exports rise
Additionally, the Middle East is the only region outside of West Africa that has shown an increase in exports to China and India.
“With more than half of the tanker fleet that was recently carrying Russian-origin crude now under OFAC sanctions, it makes sense for buyers to look to a region containing multiple ports with large VLCC loading capacity and proximity to Asia, particularly India,” Maroo said.
Looking at the changes in exports after January 2025 sanctions, we see China’s historically larger Middle East suppliers (Saudi Arabia and Iraq) have increased exports the most, at the expense of other producers.
Source: Vortexa
India has opted to gradually increase imports from smaller suppliers such as the UAE, Kuwait, Oman, and Qatar. Meanwhile, imports from Saudi Arabia and Iraq have remained steady.
More pivots expected
Initial analysis suggests that OFAC sanctions in January have prompted India to diversify its crude oil suppliers, while China has consolidated its reliance on its historically large suppliers, according to Vortexa.
This observation is further supported by the trends seen with West Africa exports.
China’s swift response–increased ship-to-ship activity and reported port group ownership changes–aligns with this strategy, Maroo said. The aim is to sustain Russian Far East ESPO flows into China to the greatest extent possible.
The delayed return of barrels into the market by the Organization of the Petroleum Exporting Countries and allies from April will be compounded by the potential divergence in crude procurement by India and China.
“With Saudi Arabia and the UAE likely to be the biggest contributors to this, we could see another pivot, particularly in India’s case, towards the largest producers again,” Maroo added.
