Fueling the Conflict: Russia's Reliance on Indian Refineries

Russia's Fuel Crisis: A Turning Point in the Conflict?

The recent surge in oil product imports by Russia has sent shockwaves throughout the global energy market. According to a report by the Centre for Research on Energy and Clean Air (CREA), Russia imported a record 172,000 tonnes of oil products in August, with India supplying 70% of the imports.

The reliance on Indian refineries is a direct result of Ukraine's sustained drone campaign against Russia's oil refineries and energy infrastructure. The campaign has reduced domestic fuel production, leading to shortages and forcing Moscow to rely on foreign fuel to meet domestic demand.

The volume of Russian fuel imports was more than seven times the previous monthly record and three times the total imported during all of 2025. The imports include 120,000 tonnes of gasoline worth 78 million euros, which was loaded at the Vadinar refinery and sold by EU-sanctioned Nayara Energy to Rosneft.

Rosneft owns 49.13% of Nayara Energy, while Vadinar sourced all of its crude from Russia during the first eight months of 2026, compared with 81% for all of 2025. This highlights the complex web of relationships between Russian and Indian energy companies.

The shipments underscore the impact of Ukraine's drone campaign on Russia's energy infrastructure. Each cargo of gasoline exported from Vadinar to Russia was transferred between vessels in a ship-to-ship operation off Egypt before being unloaded at Russia's Arctic port of Beloe More. All the vessels involved were sanctioned tankers, while four of the six had previously operated under false flags.

Russia's gasoline imports surged even as the country faced declining exports. Gasoline accounted for 74% of its total oil-product imports in August, compared with just 6% on average between 2023 and 2025. South Korea supplied a further 18,000 tonnes of oil products to Russia in August, mostly gasoil, while Egypt exported 25,000 tonnes of diesel worth 16 million euros.

The decline in export volumes has had a significant impact on Russia's fossil-fuel export revenues. The average price of Russia's Urals crude rose 23% in August to USD 69.90 a barrel, well above the G7 and European Union price cap of USD 44.10. The research group estimated that higher oil and gas prices following the US-Israel strikes on Iran increased Russia's seaborne fossil-fuel export revenues by about 31 billion euros in the six months after the strikes.

India's Role in Russia's Fuel Crisis

India has emerged as Russia's second-largest fossil-fuel customer in August, behind China. India imported 4.8 billion euros of Russian hydrocarbons during the month, with crude oil accounting for 4.1 billion euros, or 87% of its purchases. Indian imports of Russian crude nevertheless fell 24% from July after reaching record levels in the previous two months.

The Impact on Global Energy Markets

The fuel trade has significant implications for global energy markets. The decline in Russia's seaborne oil-product exports has led to a shortage of refined products, driving up prices and affecting supply chains. The impact of Ukraine's drone campaign on Russia's energy infrastructure has also led to a decline in crude exports through Russia's Black Sea port of Novorossiysk.

Key Takeaways

• Russia imported a record 172,000 tonnes of oil products in August, with India supplying 70% of the imports.
• Ukraine's sustained drone campaign against Russia's oil refineries and energy infrastructure has reduced domestic fuel production, leading to shortages and forcing Moscow to rely on foreign fuel.
• The volume of Russian fuel imports was more than seven times the previous monthly record and three times the total imported during all of 2025.
• The imports include 120,000 tonnes of gasoline worth 78 million euros, which was loaded at the Vadinar refinery and sold by EU-sanctioned Nayara Energy to Rosneft.
• The shipments underscore the impact of Ukraine's drone campaign on Russia's energy infrastructure and the complex web of relationships between Russian and Indian energy companies.