The sanctioned Russian crude continues to reach global markets primarily through an extensive shadow fleet of aging tankers, ship-to-ship transfers, and transponder manipulation. They utilise hundreds of unverified or falsely flagged vessels that operate outside Western insurance and maritime services. Urals crude is moved through ship-to-ship transfers from smaller vessels to larger VLCC super-tankers on open waters to lower freight costs and disguise origin. Disabling or faking Automatic Identification System (AIS) signals is used to mask illicit cargo handoffs. The crude gets directed through steady flows toward major buyers in Asia, such as Chinese independent refiners and Indian importers, utilising non-Western payment networks.
China’s Russian Oil and Gas Requirements and Supplies
China imports significant volumes of crude oil, pipeline gas, and liquefied natural gas (LNG) from Russia to support its massive domestic energy requirements, having scaled up purchases amid Middle East supply tightening. China imports over 2.4 million barrels per day (bpd) of Russian crude, combining roughly 1.4 million to 1.68 million bpd via seaborne shipments and about 1 million bpd through land pipelines. Key conduits include the Skovorodino-Mohe pipeline and seaborne deliveries of Eastern Siberia–Pacific Ocean (ESPO) grade crude from ports like Kozmino.
Chinese refiners (such as Sinopec) heavily utilise discounted Russian crude and secure advance cargoes via the Arctic Northern Sea Route to bypass Middle Eastern disruptions. Gazprom supplies China via the Power of Siberia 1 pipeline, delivering upward of 38 billion cubic metres (bcm) annually as volumes scale toward its 44 bcm capacity. Russian LNG shipments to China reached nearly 9.8 million tonnes, solidifying Russia’s position as a top-three LNG provider to the Chinese market. Negotiations continue on the proposed Power of Siberia 2 pipeline (targeting an additional 50 bcm/year through Mongolia) to further lock in long-term supplies.
China’s Middle Eastern Sourcing
China also relies on the Middle East for over 50% of its total crude oil imports, making the region vital to its national energy security. Recent conflicts involving Iran and disruptions in the Strait of Hormuz have significantly impacted these trade flows. Major contributors include Saudi Arabia (approx. 14%), Iran (11%), Iraq (10%), Oman (7%), and the UAE (6%). China buys roughly 80% to 87% of Iran’s shipped oil (about 1.4 million barrels per day), saving billions via heavy discounts despite U.S. sanctions. Ongoing geopolitical conflict in early 2026 effectively choked off vital Persian Gulf shipping lanes and collapsed regional liquefied petroleum gas (LPG) and naphtha shipments.
India’s Russian Oil and Gas Purchases
India’s purchases of Russian crude oil hit record levels in mid-2026 before dropping to a five-month low in September as refiners diversified their supply mix. Russian crude reached a record 50.83% (2.47 million bpd) of total Indian imports. In September, imports fell to 1.75 million bpd amid geopolitical pressures and supply diversification. India remains the world’s second-largest buyer of Russian fossil fuels after China.
Middle Eastern supply tightening and regional conflicts prompted increased reliance on Russian barrels. Major Indian refineries in Jamnagar and Vadinar processed the intake, turning a portion into refined products. Ukrainian attacks on Russian refineries led to minor emergency shipments of refined fuel from India back to Russia. The U.S. enacted the Sanctioning Russia and Iran Act (SRIA) of 2026, introducing potential secondary tariffs on top buyers of Russian petroleum. As part of strategic hedging, Indian state refiners are balancing dependencies by increasing spot volumes from the Middle East, Latin America, and Africa.
India’s Middle Eastern Sourcing
India has ramped up its crude oil imports from the Middle East to around 2.7–3 million barrels per day in September 2026, recovering to pre-conflict levels as flows through alternative regional routes and ports stabilised. Middle Eastern crude imports surged 74% in September, making up 39.5% of total supplies following earlier disruptions near the Strait of Hormuz. Russia remains India’s single largest oil supplier despite cutting a portion of its August–September flow amid rising US tariff pressures.
Indian refiners are widening their baskets to include supplies from Venezuela, Brazil, and Africa. State-owned refiners are increasing US liquefied petroleum gas (LPG) purchases by over 25% for the upcoming year. Refiners are utilising alternate UAE ports like Fujairah and Khorfakkan, plus Oman’s Sohar port, bypassing the Strait of Hormuz. The Habshan-Fujairah pipeline allows direct crude transport to the UAE’s eastern coast. As Strategic Reserves, New Delhi and the UAE are exploring long-term crude and gas storage agreements in Fujairah.
Major Indian Petroleum Export Destinations
India’s top refined petroleum export destinations include the Netherlands, United States, United Arab Emirates, Singapore, and Australia. The Netherlands is the primary entry point and trading hub for refined fuels heading into European markets. The United States is the major destination for specialty chemicals, naphtha, and petroleum coke. The United Arab Emirates is the key Middle Eastern partner for re-exported petroleum products and fuel oils. Singapore is the strategic Asian trading and bunkering hub for diesel and fuel oil. Australia is a consistent regional consumer of Indian high-speed diesel and motor spirit.
Europe receives bulk shipments of diesel and naphtha, making India a top supplier to the EU. India supplies high-speed diesel and petrochemical feedstocks to countries like Singapore, Japan, and South Korea. India exports diesel, petrol, and bitumen to African markets, including South Africa.
India’s Petroleum Products Reaching Russia and Ukraine
India has emerged as a major supplier of refined petrol to Russia, providing roughly 70% of Russia’s fuel imports in August 2026 due to Ukrainian drone strikes damaging domestic Russian refineries. The Vadinar refinery in Gujarat—operated by Nayara Energy (part-owned by Russian giant Rosneft)—processes Russian crude. Processed gasoline (around 120,000 tonnes worth €78 million in August 2026) is shipped back via complex routes like ship-to-ship transfers near Egypt to ease Russian shortages.
Sustained Ukrainian attacks on Russian energy infrastructure severely limited Moscow’s domestic refining capacity, forcing the traditional fuel exporter to import. Indian authorities and Minister Hardeep Singh Puri maintain that Indian refiners do not directly export fuel to Russia, noting that transactions occur via international traders. Nayara Energy faces EU sanctions, and the trade loop has drawn scrutiny and tariff threats from Western nations.
India became a major supplier of refined diesel to Ukraine, turning into its largest single diesel source despite complex geopolitical supply chains. India captured over 15% of its import share. The shipments bypass direct routes, moving into Ukraine via regional hubs like Romania and Turkey. The underlying paradox is that a notable portion of this exported fuel is refined from discounted Russian crude oil processed in Indian refineries. The destruction of domestic refining assets like the Kremenchuk Refinery forced Ukraine to heavily rely on imports.
The Hilarious But Real Great Circle of Crude
Somewhere in Russia, a barrel of oil is loaded onto a tanker. It has no idea it is about to become the most morally flexible object on earth. It sails to Jamnagar, where India buys it at a “friendship discount”. India calls this strategic autonomy. The West calls it funding the war. At the refinery, the crude is heated, cracked, and distilled, and something miraculous happens. The Russian molecules leave, and Indian diesel emerges. Nothing about the chemistry has changed, but the paperwork has undergone a spiritual rebirth. It is the only known process that turns sanctions into margins.
Europe now steps in. In the morning, it sanctions Russian oil. By lunch, it fills its tanks with Indian diesel. At dinner, it lectures India on values. Europe does not buy Russian oil. It buys Russian oil that has been to finishing school. America is furious that India buys Russian crude and slaps on tariffs to show it. It then quietly carries on importing Russian enriched uranium, because principles are like fuel—best refined before use.
Now comes the masterstroke. Ukraine needs diesel to resist Russia, so it buys Indian diesel with money given to it by Europe. India then pays Russia for the next barrel. So European taxpayers fund Ukraine, which pays India, which pays Russia, which funds the missiles that make Ukraine ask Europe for more money. It is the first war in history with a subscription model.
Russia, meanwhile, earns money from the fuel powering the trucks that resist its own army. It is the only belligerent to have outsourced both its revenue and its opposition’s logistics to the same refinery.
Finally, Russia is paid for the war by the war. Ukraine is fighting Russia on Russian fuel, bought with European money. Europe is morally clean, operationally Indian fuelled. America is outraged, selectively. India is charging a refining margin on everyone’s hypocrisy. The barrel has travelled more than most diplomats, and achieved more. The money circles the globe like a vessel on DP (Dynamic Positioning) holding station, burning enormous energy, going nowhere, and everyone on the bridge insists it is under control.
Header Picture Credit: Representative Image Generated using AI
Twitter: @AirPowerAsia
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So nicely analysed.Thus is the whole truth
Thanks