Oil Daily | India to Boost Russian Oil Imports Despite U.S. Tariffs, Prioritizing Cost-Effectiveness

【Global Oil Supply and Demand】

India's state-controlled and private refiners plan to reduce near-term purchases of Russian oil as the U.S. increases tariffs on Indian goods to 50% due to India's Russian crude imports. However, India's refineries still intend to continue buying affordable Russian crude despite U.S. pressure.

Indian crude oil production declined by 0.7% year-on-year in July to 2.4 million metric tons, while processing rose by 3.2% to 23.3 million tons. Over 80% of India's crude oil demand is met through imports, leading the government to boost domestic supply by tapping deepwater resources.

India is expected to increase crude arrivals in September and October, driven by higher inflows of Russian oil despite external pressures from the U.S. over this supply. Indian refineries prioritize economic considerations in their procurement decisions, according to Vortexa's Head of APAC Analysis, Ivan Mathews.

Despite the U.S. tariff on Indian goods, India plans to continue purchasing Russian oil based on price considerations. Energy Aspects’ Amrita Sen warns that stopping Indian imports of Russian crude could lead to a spike in international oil prices and higher inflation in the U.S.

U.S. natural gas consumption is projected to reach 91.4 billion cubic feet per day in 2025, driven by colder weather and competitive pricing in power generation. The EIA highlighted growing exports, with new liquefaction trains expected to start operations, supporting the U.S.'s position as a major LNG exporter.

Pakistan is renegotiating its 2016 LNG contracts with Qatar amid potential oversupply and fiscal pressure. The Economic Coordination Committee has authorized discussions to defer obligations for 177 cargoes between 2025 and 2031, reflecting concerns over foreign exchange reserves and contract pricing tied to Brent crude.

China commissioned 21 GW of coal power in H1 2025, the highest since 2016, contradicting its renewable energy expansion efforts. The surge follows increased coal project permitting in 2022 and 2023. Despite clean energy growth, China's continued coal expansion may hinder its economic future and climate goals.

【Oil-Producing Countries Dynamics】

In Kazakhstan, international oil majors face a $4.4 billion fine for sulfur pollution despite a recent court victory. The Kazakh environmental protection ministry maintains that the fine stands, with a 40-day payment deadline and a 10-day period for appealing the decision.

【Latest Oil Policies】

India plans to explore deepwater resources to boost domestic crude oil supply and reduce dependence on imports. Prime Minister Narendra Modi announced a national deepwater exploration mission, adding to the ongoing National Critical Minerals Mission aiming to secure essential resources for energy, industry, and defense.

【Industry News】

The Northern Lights carbon capture and storage project in Norway, a joint venture by Equinor, TotalEnergies, and Shell, has successfully stored its first CO2 volumes offshore. The project, which has a capacity of 1.5 million tonnes of CO2 per year, plans to expand its capacity with EU funding support.

ONEOK, Inc., MPLX LP, Whitewater, and Enbridge Inc. are partnering to build the Eiger Express Pipeline, a 450-mile pipeline to transport up to 2.5 billion cubic feet per day of natural gas from the Permian Basin to high-demand markets. Completion is expected by mid-2028, pending regulatory approvals.

【Company News】

A company affiliated with Elliott Management, Amber Energy, leads the bid for the parent company of U.S.-based Citgo, surpassing a prior $7.4 billion offer from a consortium led by Gold Reserve. The emergence of another bidder may delay the court's final decision or increase the final price.

Shares of Ørsted fell to a record low after the U.S. Administration issued a stop-work order on a nearly completed offshore wind project. This follows Ørsted's announcement of a $9.4 billion rights issue to raise capital amid ongoing industry challenges and investor concerns.

Shares of Shuangdeng Group soared in their Hong Kong debut, reflecting strong investor interest in Chinese battery makers. The stock opened at a 55% premium to its issue price, with plans to use the proceeds for expansion in lithium-ion battery production, R&D, and international sales, especially in Southeast Asia and the Middle East.

【Others】

Pakistan's government seeks to renegotiate terms with Qatar to defer long-term LNG deliveries amid weak domestic demand and a heavy import schedule. This move is part of Islamabad's strategy to manage foreign exchange reserves and potential supply gluts, with broader implications for regional LNG contracts.