Indian refiners have reportedly payed above benchmark prices for about 60 million barrels for April delivery

Indian refiners have sharply increased purchases of Russian oil for delivery next month, paying above global benchmark prices, Bloomberg reports.

The US-Israeli war against Iran has virtually halted shipping traffic through the Strait of Hormuz, which carries around a fifth of the world's daily oil supply, triggering a surge in oil and gas prices and increasing demand for Russian oil.

Companies in the world's third-largest oil-importing nation have struck deals for around 60 million barrels of Russian crude for April, people familiar with the matter told the outlet on Wednesday. The cargoes were reportedly bought at premiums of $5 to $15 a barrel above Brent, a marked shift from the steep discounts that characterized Russian sales to India before the conflict.

The April volume is more than double the level of India's purchases of Russian oil seen in February, according to Kpler. The buying spree followed a US sanctions waiver that allowed India to take Russian oil already loaded on tankers before March 5. 

The 30-day measure, announced by Washington earlier this month to ease shortages caused by the conflict, was later expanded to cover other countries and updated to include cargoes that were at sea before March 12. India's imports of Russian oil have since soared, according to data from S&P Global Commodities at Sea.

India has become a key market for Russian oil since 2022; it bought almost 2 million barrels a day in 2024. 

The country scaled back purchases late last year under pressure from Washington, turning instead to Saudi Arabia and Iraq. Much of this Middle Eastern oil subsequently became trapped in the Persian Gulf after the outbreak of the Iran war, squeezing availability and pushing Brent crude prices to as high as $120 a barrel this month.

India imports 85% of its oil and nearly half of its natural gas. Around half of its crude oil and LNG shipments are routed through the Strait of Hormuz.

Officials in New Delhi expect the US waiver to be extended as long as disruptions through the strait persist, Bloomberg's sources said.