Oil Daily | U.S. Tariffs Redirect Russian Oil from India to China, Deepening Urals Crude Discounts

【Global Oil Supply and Demand】

Russia's Urals crude, previously routed to India, is now offered at discounts in China due to altered trade flows spurred by new U.S. tariffs on Indian imports of Russian oil. This shift may not entirely compensate for the volumes previously purchased by Indian refiners.

Indian refiners are securing 22 million barrels of non-Russian crude for delivery in September and October as a response to new U.S. tariffs on Russian oil. The refineries are looking for alternative supplies amid market uncertainties and have bought from various countries.

Reliance Industries warns that geopolitical events and tariffs could impact global crude flows and market balances. The company highlights geopolitical tensions, redirections of shipping routes, and production decisions as critical factors influencing crude prices and market dynamics.

【Oil-Producing Countries Dynamics】

Indian refiners are halting spot purchases of Russian crude for October loading following U.S. tariffs on India's imports from Russia. The decision impacts Russian crude availability and deepens the discount of Russia’s Urals crude on the market.

【Latest Oil Policies】

U.S. President Trump announced an additional 25% tariff on Indian goods, targeting India's Russian crude imports. This increases the total tariff rate to 50%, with potential for similar tariffs on other countries importing Russian oil.

【Industry News】

Israel’s Leviathan Partnership finalized a $35 billion natural gas export deal with Egypt, aiming to supply 130 BCM of gas through 2040. The agreement includes infrastructure upgrades and promises to enhance regional cooperation and stability.

【Company News】

Brazil's Petrobras reported a $1.6 billion profit for Q2, recovering from a Q1 loss. This positive outcome, despite lower oil prices, was driven by a 5% increase in production and efficiency improvements in existing fields.

General Motors will source LFP batteries from China's CATL for the Chevrolet Bolt, despite tariffs. This temporary measure ensures GM meets its production timeline while domestic battery production ramps up.

Lyten acquired assets of the bankrupt European battery firm Northvolt, including gigafactories in Sweden and Germany. The acquisition aims to restart production and integrate new technologies for energy storage.

Cheniere Energy reported an 85% increase in Q2 net income due to strong LNG demand. The company completed an expansion at its Corpus Christi facility and plans to further increase LNG production capacity.

【Others】

The U.S. intends to replace the deputy executive director of the IEA due to dissatisfaction with the agency's focus on energy transition. This move aligns with the administration's goal to influence the agency's future direction.