Group 1 - Indian Oil Corporation (IOC) is seeking to purchase non-sanctioned Russian crude oil for delivery in early 2026, along with crude from the U.S. and West Africa, ensuring compliance with international sanctions [1] - Last month, IOC acquired five cargoes of Russian crude from non-sanctioned entities, totaling approximately 3.5 million barrels of ESPO crude, at prices comparable to Dubai quotes for delivery in December [2] - Following U.S. sanctions on major Russian oil producers, Indian refiners are shifting away from Russian crude, with IOC planning to buy 24 million barrels from the Americas in Q1 of next year to compensate for lost Russian supply [3] Group 2 - Most Indian refiners have refrained from ordering Russian crude for December due to U.S. sanctions on Rosneft and Lukoil, leading to increased purchases from the Middle East and Americas to mitigate expected declines in Russian loadings [4]

Summary of Key Points from J.P. Morgan's Oil Markets Weekly Industry Overview - The report focuses on the oil market dynamics, particularly the implications of U.S. sanctions on Russian oil exports and the responses from major importing countries like China and India [1][3][7]. Core Insights and Arguments - The Trump administration has warned that India and China could face penalties for their ongoing purchases of Russian oil, potentially putting 2.75 million barrels per day (mbd) of Russian seaborne oil exports at risk [3] - China has indicated it will maintain its buying patterns, although it may quietly reduce imports in exchange for eased restrictions on technology exports [3] - India has shown compliance with European and U.S. secondary sanctions, directing its oil refiners to develop plans for sourcing non-Russian crude [3] - Russia could potentially divert 0.8 mbd of its seaborne exports to countries like Egypt, Malaysia, Vietnam, Brunei, and South Africa [3] - China's blending capacity could absorb an additional 1 mbd of Russian crude, raising Russia's share to 25% of China's imports, surpassing the 20% threshold [3][27] - If India ceases purchases, 1.55 mbd of Russian oil exports are at risk, and if both India and China stop, nearly 2.75 mbd would be jeopardized [28] - The U.S. administration may find sanctioning Russia's oil exports unfeasible without causing a significant spike in oil prices [7] Additional Important Insights - Brent oil prices spiked by $5 per barrel following news of potential sanctions, with expectations of a decline to $60 by year-end if no decisive action is taken [6] - The report highlights that the geopolitical landscape is influencing oil trade, with countries like Turkey maintaining a balancing act between Russia and the West [21] - Several Indian state-owned refiners have halted Russian oil purchases, and private refiners are considering reductions due to new EU sanctions [5] - Brazil's imports of Russian clean petroleum products surged by 500% since the start of the Russia-Ukraine war, although volumes remain modest at 200,000 barrels per day (kbd) [22] - The report outlines potential new trade routes and refinery capabilities in various countries that could absorb Russian crude, including Egypt, Malaysia, and South Africa [32][33][38] Conclusion - The ongoing geopolitical tensions and sanctions are reshaping the global oil market, with significant implications for Russian oil exports and the strategies of major importing countries. The ability of these countries to adapt to changing circumstances will be crucial in determining the future dynamics of the oil market [1][3][7].