India’s reliance on Russian oil may be ‘approaching a limit’

India’s ability to import more Russian oil may have hit a limit for the rest of the year, analysts tell CNBC, citing infrastructural and political constraints, as well as limitations to Russian oil flows.

“India will look to continue Russian crude imports, but perhaps it has reached its limit, hampering any additional barrels,” according to Janiv Shah, senior analyst at Rystad Energy.

Since the Kremlin’s invasion of Ukraine in February last year, India’s refiners have been snapping up discounted Russian oil.

Moscow has since leapfrogged to become India’s leading source of crude oil, accounting for about 40% of India’s crude imports. June marked the 10th consecutive month-on-month increase in India’s imports of Russian crude, data from commodity intelligence firm Kpler showed.

“An unprecedented feat in recent history, especially given the volumes in question — 2.2 million barrels per day in June,” Kpler’s lead crude analyst, Viktor Katona said.

And that’s the highest volume that India’s imports of Russian oil can go — at least for the rest of the year, according to his predictions.

“I would say 2.2 million b/d will be the peak this year … We believe India’s imports of Russian crude will see a slight downward correction to two million barrels per day. That will be the sustainable level of buying,” he said.

However, the volume of crude oil consumed and processed by India’s refineries has now hit a “seasonal peak” and would only trend downwards from here, Rystad Energy’s Shah told CNBC in an email. 

His sentiments were echoed by Katona, which highlighted that in addition to refineries being currently shut, demand for oil is set to trickle down too.

“For the first time this year, some of Indian refiners…