Indian Refiners Reduce Russian Crude Purchases Amid Supply Disruptions

Indian refiners are facing challenges in securing Russian crude oil as Ukraine's escalating drone campaign disrupts key export flows. The Novorossiysk terminal, which previously handled around 840,000 barrels per day for Indian buyers, has been significantly impacted by these attacks, leading to persistent supply bottlenecks.

In December 2025, India's imports from Russia fell to approximately 1.14 to 1.24 million barrels per day, largely due to tighter sanctions on major Russian producers like Rosneft and Lukoil. However, by mid-2026, imports surged to a record average of roughly 2.6 million barrels per day, constituting over half of India's total oil imports. The ongoing attacks have reportedly knocked out up to 40% of Russian refining capacity during peak strike periods.

State-run companies such as Indian Oil Corporation and Bharat Petroleum Corporation Limited have maintained stable import flows by sourcing from compliant channels, benefiting from government backing. In contrast, Reliance Industries, India's largest private refiner, has reduced its Russian crude purchases during heightened sanctions enforcement.

As global supply pressures mount, India, which imports over 80% of its crude oil needs, is diversifying its sources, increasingly looking to the Middle East, Africa, and spot markets. This strategic shift indicates a tightening of oil supply, which could influence global crude prices.

Market observers are closely monitoring the actions of key energy market players, such as OPEC and the International Energy Agency, as their decisions regarding production adjustments could significantly impact global oil supply dynamics.

New Developments in Hybrid Operations

Russia is reportedly escalating its hybrid operations against European countries amid the ongoing Ukraine conflict. This includes incidents of arson, cyber attacks, and armed drone incursions, marking a significant intensification of hybrid warfare tactics.

The European Union (EU) has recognized the increasing security threat posed by these operations, yet a comprehensive response plan remains absent across the bloc.

In prediction markets, the likelihood of Russian forces entering Sloviansk by December 31, 2026, is currently estimated at 25%, a slight decrease from 28% the previous day. This reflects the heightened tensions and potential military escalations.

Armed drone incursions are particularly concerning due to their kinetic implications, indicating a shift from previous disinformation tactics to more direct threats.

Key Takeaways

• Increased hybrid operations by Russia align with heightened military activity.
• The probability of Russian forces entering Sloviansk is currently at 25% YES.
• Armed drone incursions suggest a significant kinetic threat impacting market perceptions.

What to Watch

Observers should keep an eye on Russia's military strategy and any troop movements towards strategic locations like Sloviansk. Responses from NATO or further EU security measures could also influence market views.