November 11, 2026: Indian refiners are reducing their intake of Russian Urals crude as rising freight costs and tightening processing margins erode the economic advantage of the grade. The physical deliverable supply of Urals to India is facing increased competition from Middle Eastern barrels, which offer shorter transit distances and more predictable landed costs for companies such as Bharat Petroleum Corp

The market narrative of parity between Urals and Dated Brent has shifted. Trading sources indicate that December Urals cargoes are now being offered to Indian buyers at a discount of $1-2 per barrel relative to Dated Brent (adjusted for delivery costs). This return to a discount follows a brief period where the grade traded near parity, reflecting the need for sellers to maintain attractiveness as refinery margins decline.

The cost of delivery remains a decisive physical constraint. High freight rates, compounded by maritime security risks in the Black Sea-particularly around Novorossiysk-have increased the final landed price of Russian crude. Simultaneously, strong demand from Chinese refineries has limited the available volume of Russian grades for the Indian market, further tightening the supply available for delivery to the subcontinent.

Processing Shifts and Export Volumes

Russian crude availability for export is expected to fluctuate due to changes in domestic processing capacity. A projected decrease in export volumes through Baltic and Black Sea ports next month is tied to Russian refineries increasing their internal throughput.

This shift toward domestic processing is driven by expanded export opportunities for refined products. Following the partial easing of diesel export restrictions, Russian shipments of diesel are forecasted to rise from 0.5 million tons in October to 2.15 million tons in November. However, the stability of this processing capacity remains vulnerable to ongoing infrastructure attacks on refineries.

While traders have already established loading schedules for November and are contracting for January arrivals, the ability of Russia to maintain its market share in India depends on whether it can offset logistical costs with deeper discounts or pivot its resource base toward higher-value refined exports.

(Source: Pravada.ru)