Two Russian Urals Tankers Divert 14 Million Barrels to Indian Ports
Two tankers carrying Russian crude initially to East Asia have now diverted to India, Bloomberg has reported, as Asia grapples with an oil supply crunch amid the Strait of Hormuz traffic freeze. The two vessels are carrying some 1.4 million barrels of Urals and are expected to arrive at their new destinations by the end of the week, the report said, citing ship-tracking data from Kpler and Vortexa. In fact, one of them, a Suezmax carrying 730,000 barrels of Urals, has already arrived at a port on India’s east coast. The other, an Aframax with a cargo of 700,000 barrels, is seen arriving at Vadinar, on India’s west coast, today. Earlier this week, Bloomberg again reported that India was considering returning to buying Russian crude amassed in floating storage in Asia as the war in Iran and Tehran’s retaliatory strikes in the region have severely disrupted oil flows from the Middle East. The state-held refiners of India, the world’s third-largest oil importer, and Indian government officials met over the weekend to discuss emergency supply plans following the major escalation in the Middle East. These plans include a potential return of Indian refiners purchasing Russian oil, sources with knowledge of the discussions told Bloomberg. Indian refiners sharply reduced their intake of Russian oil following the imposition of sanctions by the United States on Russia’s two biggest exporters—Rosneft and Lukoil—last November. As a result, flows fell to 1.2 million barrels daily in December 2025. This was the lowest daily rate since 2022, with volumes falling further to barely over 1.1 million barrels daily in January. The rate remained flat in February, according to Vortexa, which noted that Indian refiners had diversified away from Russian crude with Middle Eastern grades—the ones currently paralysed by the Strait of Hormuz crisis.
West Asia conflict hits India’s LNG supplies as Petronet, QatarEnergy issue force majeure notices
Amid the ongoing West Asia conflict and the heavy disruption in vessel transit through the critical chokepoint of the Strait of Hormuz, India’s largest importer of liquefied natural gas (LNG) Petronet LNG has issued force majeure notices to its key supplier QatarEnergy, and its off-takers GAIL (India), Indian Oil Corporation, and Bharat Petroleum Corporation. Moreover, QatarEnergy has also issued a notice indicating a potential force majeure due to the conflict, which has forced the LNG producer to halt production. These force majeure notices are indicative of an LNG supply cut, and according to sources, gas supplies to industries in India have been reduced in the anticipation of tighter LNG deliveries to the country amid the West Asia crisis. Shares of Petronet LNG tanked nearly 12% on Wednesday morning, before recovering slightly. Shares of other oil and gas companies with exposure to LNG—like GAIL, Indian Oil, Bharat Petroleum, Mahanagar Gas, and Indraprastha Gas—fell notably. Force majeure is a clause in contracts that frees parties from liability or obligation when an extraordinary and unforeseeable event beyond their control occurs. Such events commonly include wars, strikes, riots, epidemics, and natural disasters. In this specific case, the force majeure notices indicate that Petronet LNG is unable to lift LNG cargoes from Qatar and supply the contracted quantities to its off-takers, and Qatar—India’s largest LNG supplier—is unable to fulfil its supply obligation. Petronet LNG has long-term contracts to buy 8.5 million tonnes per annum (mtpa) of Qatari LNG. It also buys additional LNG volumes from Qatar from the spot market. Other Indian oil and gas companies also buy LNG from the UAE. In all, India imports around 27 mtpa of LNG from various sources, over half of which comes from the Gulf region.
StanChart Hikes Oil Price Forecast To $74 Per Barrel Amid Iran Conflict
Iran has launched a massive retaliatory campaign following joint U.S. and Israeli airstrikes, sending an unprecedented barrage of more than 500 ballistic missiles and 2,000 drones across targets in Israel and several Gulf states. A drone strike on a command center killed six U.S. service members in Kuwait while several missiles were intercepted near Al Udeid Air Base, the largest U.S. base in the region. Commodity analysts at Standard Chartered have hiked their oil price forecasts, noting that unlike last year’s largely symbolic response, Iran’s much broader approach in the fresh conflict have resulted in several regional flashpoints that pose real risk to oil supply flows, including potential contagion affecting US-operated assets. StanChart now sees Brent crude averaging $74 per barrel in the first quarter of 2026, up from its previous forecast of $62 per barrel; Q2 to $67/bbl (from $63/bbl) and 2026 average to $70/bbl (from $63.50/bbl). The analysts add that there’s asymmetric upside risk to these forecasts if the conflict escalates further and impairs production from Iran and any of the regional producers. StanChart has flagged the significant risk posed to Iraq’s oil flows thanks to its heavy reliance on transit through the Strait of Hormuz. Iraq has begun to shut in some major oil fields, such as Rumaila, and cut back production at others, such as West Qurna 2, with storage tanks reaching capacity. The Strait of Hormuz remains the biggest flashpoint, with the waterway used for energy transit of ~31% of seaborne crude and condensate. This is mostly destined for China and India, which may turn to Russia for alternative supply. In addition, it’s used for 19% of LNG (including all supply from Qatar), 19% of jet fuel and kerosene tilted towards European supply and 33% of global fertiliser transit. Whereas no barrels have been lost so far, StanChart notes that the risk to vessels from mines or missiles has increased insurance premiums and supertanker shipping costs dramatically. To wit, supertanker freight rates from the Middle East to China on the TD3 route now exceed $400,000 per day, double the rate from 27 February, which was already a six-year high. That rate now includes war-risk bonuses and hazard pay for crews, with the exorbitant costs making it uneconomical for the majority of companies. According to StanChart, tanker tracking suggests that limited transit is skewed towards Iranian on Chinese vessels, and this could trigger a rise in landed crude costs–even if the flat price stabilizes–if the freight premium is retained for prolonged periods of time and becomes a structural rather than a temporary cost. That said, there are mitigating factors that could help check oil prices. According to StanChart, there is limited infrastructure in place to allow a bypass of the Strait of Hormuz and provide some relief to disruption to crude flows. Saudi Arabia and the UAE have pipelines that usually operate at less than full capacity, giving an estimated 2.6 million barrels per day (mb/d) of spare capacity to redirect exports. This includes: Unfortunately, alternative routes for refined products and LNG are significantly more limited. Natural gas prices have spiked after QatarEnergy declared force majeure on LNG deliveries on Monday, taking about 20% of global LNG production offline, the vast majority of which goes to Asian customers. Coupled with the shutdown of some Israeli fields, this has exposed the structural vulnerability of the LNG market, leaving buyers scrambling for spot cargoes. This panic buying of JKM to cover lost cargoes pushed it to its highest premium over the Dutch Title Transfer Facility (TTF) since 2021. European natural gas futures pulled back nearly 10% on Wednesday to trade at €49.7 per megawatt-hour after vaulting nearly 60% over the prior two sessions. However, U.S. gas markets remain well insulated, with Henry Hub gas prices falling 3.3% to trade at $2.95/MMBtu on Wednesday.