Russia Shrugs Off India’s Oil Deal With Trump
Russia sees no danger for its oil exports from the trade deal that the U.S. president sealed with his Indian counterpart earlier this week. Per the deal, Washington will cut tariffs on Indian goods, and New Delhi will commit to expanding purchases of U.S. oil and gas. “We, along with all other international energy experts, are well aware that Russia is not the only supplier of oil and petroleum products to India. India has always purchased these products from other countries. Therefore, we see nothing new here,” Dmitry Peskov, Kremlin spokesman, told the media, as quoted by The Hindu earlier today. “The American shale oil they export is light grades, similar to gas condensate. Russia, on the other hand, supplies relatively heavy, sulfur-rich Urals. This means India will need to blend U.S. crude with other grades, which incurs additional costs, meaning a simple substitution won’t be possible,” an energy expert from Russia’s National Energy Security Fund said. The news of the deal was taken by most observers to mean a further squeeze on Russian oil exports to India, although some analysts noted that India will be hard-pressed to reduce its intake of Russian crude, which accounts for about a third of total imports to date, up from a minuscule 2% before 2022. For nearly four years, India imported so much Russian crude that Russia became its single biggest oil supplier, accounting for about a third of all imported crude. However, Indian refiners have recently scaled down purchases of Russian crude following the U.S. sanctions on Russia’s oil giants Rosneft and Lukoil. Indian refiners have halted imports from the now-sanctioned entities and turned to non-sanctioned Russian supply and alternative cargoes from the Middle East, the Americas, and, to a lesser extent, West Africa, depending on prices. The deal with Trump will open up access to Venezuelan and possibly even Iranian oil, analysts said, following the news, to reduce purchases from Russia.
IGX traded gas volume of 8.4 million mmbtu (212 mmscm), up by 50% MoM & 17% YoY
January’26, IGX achieved monthly trade gas volume of 8.4 million MMBtu (212 MMSCM), volume up by 50% MoM & 17% YoY basis, the rise in volume was primarily due to CGD demand & domestic HPHT gas trade volume. Around 16% of the traded volume was free-market gas, while 84% was domestic HPHT gas at the ceiling price (₹878 or $9.72/MMBtu). Nearly 8 MMSCM of domestic gas with pricing freedom was traded by producers at Bokaro (CBM), Jaya, KG Basin, and Hazira-ONGC delivery points. Indian Gas Exchange’s benchmark price index, GIXI®, for January 2026 was ₹962/$10.6 per MMBtu—down by 3% MoM & 21% YoY. Prices trended on a downward YoY basis, due to increased local supply. International prices trended upward MoM basis due to extended winters and geopolitical reason, with European and Asian spot gas benchmarks monthly average as follows: TTF at $13/MMBtu (up by 32% MoM, down by 19% YoY), WIM-Ex Dahej at $11.4/MMBtu (up by 8% MoM & down by 25% YoY), while US Henry Hub averaged at $4.1/MMBtu (down by 7% MoM, up by 10% YoY).
LPG support remains central to ministry spending
The Petroleum Ministry budget remains overwhelmingly subsidy-driven. A one-time grant of Rs 175 billion has been provided in 2026–27 to public sector oil marketing companies (OMCs) to compensate for under-recoveries on domestic LPG sales, following a Rs 125 billion provision in the revised estimates for 2025–26. In addition, total LPG subsidy outgo, including direct benefit transfer and connections to poor households, stands at Rs 110.845 billion in 2026–27. An extra Rs 10 billion is to be met from the Oil Industry Development Fund to finance LPG connections for poor households. Biofuels get a sharper push from a low base Biofuels emerge as one of the few areas seeing a meaningful increase in budgetary support. Allocations for the Pradhan Mantri JI-VAN Yojana, which supports advanced bioethanol projects, have been raised to Rs 1969 million in 2026–27 from Rs 379 million in the previous year’s revised estimates. Support for biomass collection has also been increased to Rs 1 billion from Rs 100 million, pointing to a renewed focus on feedstock availability for bioenergy programmes, albeit from a relatively small base.
Trump’s India pact to make big dent in Russian oil revenue
Russia faces a steep drop in oil income if U.S. President Donald Trump successfully pressures India to stop importing Russian crude, because losing its top purchaser of seaborne exports would force Moscow to slash prices to find other buyers, analysts and traders said. Trump on Monday cut U.S. tariffs on Indian goods in a trade deal he said also included provisions for India to halt oil imports from Russia, the world’s second-biggest oil exporter. The United States is putting pressure on Russia to agree a peace deal in Ukraine. Trump has over the past year already claimed that Indian Prime Minister Narendra Modi agreed to stop buying Russian oil. India never halted imports, however, citing its need for energy security and for cheap oil. The Kremlin says energy cooperation with India, its second largest oil buyer after China, is strong after Russian President Vladimir Putin visited the country in December 2025. But Indian refiners are taking a cautious approach to Russian oil purchases, which is already hurting Moscow’s income. Russian oil imports dropped 22% to 1.38 million barrels per day in December from November, their lowest since January 2023, reducing Russia’s share in Indian imports to 27.4% while OPEC’s share rose to 53.2%, according to Reuters’ calculations. That follows a peak in India’s Russian oil imports at around 2 million barrels per day in June 2025. “Any further reduction would already be meaningful, because there is only one relevant alternative buyer – China – which has also its limitations in taking in sanctioned crude,” said David Wech from Vortexa consultancy. The pressure on Russia is increasing as oil discounts widen and fewer buyers are willing to take the risk, Wech said. Prices for Russian oil have sunk to record lows, while Russia’s budget shows a deficit due to a shortfall in energy revenues, according to a government official.
The Russian niggle in the India-US trade deal amid the celebrations
India-US trade deal has been widely welcomed by markets and exporters, but one unresolved issue could yet test the durability of the deal, according to CreditSights, a Fitch company. India’s commitment to halt Russian oil purchases in return for sharply lower US tariffs carries economic and political risks that may surface once the initial euphoria fades. The India-US trade deal, announced by US President Donald Trump on Monday, will see Washington cut tariffs on Indian goods to 18% from 50%. In exchange, India has agreed to put zero tariff on US goods, lower trade barriers, halt purchases of Russian oil, and step up imports of oil and other goods from the US, and potentially Venezuela. India has confirmed the tariff reduction but has not commented publicly on the Russian oil aspect. However, Russia said it hasn’t received any communication from New Delhi indicating that India plans to stop buying Russian oil. Trump said India had committed to buying more than $500 billion worth of US energy, technology, agricultural and other products. A government official told Reuters on Tuesday that India has agreed to increase purchases of petroleum, defence goods, electronics, pharmaceuticals, telecom equipment and aircraft from the US. “Ceasing all Russian oil purchases and stepping up US/Venezuelan oil purchases will likely increase India’s oil import bill, given higher freight costs and sanctions on Russia (Russian oil typically trades $6-$10 per barrel lower than Brent); this could affect inflation and government oil subsidies, though we note that inflation remains well contained within the RBI’s 2%-6% tolerance band,” the Fitch company said.
US Crude Oil Inventories Take Big Hits In Storm Aftermath
The American Petroleum Institute (API) estimated that crude oil inventories in the United States decreased by 11.1 million barrels in the week ending January 30. Crude oil inventories decreased by 247,000 barrels in the week prior. Inventories in the US Strategic Petroleum Reserve (SPR) keep climbing week after week. The Department of Energy (DoE) reported that crude oil inventories in the SPR rose by 200,000 barrels to 415.2 million barrels in the week ending January 30. This is 310.3 million barrels shy of maximum capacity. US production fell for the fourth week in a row during the week of January 23 to 13.696 million bpd, down from 13.732 million bpd in the week prior, according to the latest EIA data. This is 456,000 bpd more than this same time last year. At 3:54 pm ET, Brent crude was trading up on the day at $68.10 (+2.71%). Brent is now roughly $0.70 per barrel up from this time last week as tensions in the Middle East persist. WTI was also trading up on the day, by $1.89 (+3.04%) at $64.03. Gasoline inventories rose this week, gaining 4.7 million barrels in the week ending January 30. In the week prior, gasoline inventories fell by 415,000 barrels. As of last week, gasoline inventories were 5% above the five-year average for this time of year, according to the latest EIA data. Distillate inventories fell in the reporting period by 4.8 million barrels, after gaining 2 million barrels in the week prior. Distillate inventories were 1% above the five-year average as of the week ending January 23, the latest EIA data shows. Cushing inventory—the inventory kept at the delivery hub for the WTI Crude futures contract—fell by 1.4 million barrels, after decreasing by 92,000 barrels in the prior week.
India to ramp up purchases of US oil, arms, aircraft; open some farm access
India has committed to purchasing petroleum, defence goods, electronics, pharmaceuticals, telecom products, and aircraft from the United States under a newly announced trade agreement, stated a report in Reuters, citing sources. The deal, following bilateral negotiations, is intended to address the US trade deficit with India and is expected to influence multiple sectors over the coming years, the report added. The official also noted that India has offered market access in some agricultural products, the report said, though details were not disclosed. US President Donald Trump confirmed the agreement, stating India agreed to “BUY AMERICAN at a much higher level” and could purchase up to $500 billion worth of US energy, coal, technology, agricultural, and other products. India has reduced tariffs on automobiles as part of the deal, responding to a key US request aimed at balancing bilateral trade. The Indian government official said these measures are part of broader efforts to address ongoing trade imbalances. Commerce ministry data showed India’s exports to the US rose 15.88 per cent year-on-year to $85.5 billion between January and November, while imports stood at $46.08 billion.
India’s crude import cost slips below $60 a barrel
India’s average crude oil import cost fell below $60 a barrel on Monday, among the lowest it has been in five years despite global geopolitical upheavals and sanctions against three major crude oil suppliers—Iran, Russia and Venezuela. The daily average price of various crude grades (popularly known as Indian basket) dipped to $59.29 a barrel on January 5. The last time, the daily average price of Indian basket stood below $60 was on February 5, 2021 (at $59.34). The Indian basket of crude oil represents a cocktail of sour grade and sweet grade of crude oil processed in Indian refineries. The research report prepared by the State Bank of India (SBI) said on Monday that crude oil prices would “soften significantly in 2026” to touch $50 per barrel by June 2026. The US Energy Information Administration (EIA) forecast a fall in oil prices to $55 a barrel in 2026. “We forecast the Brent crude oil price will fall to an average of $55 per barrel in the first quarter of 2026 and remain near that price for the rest of next year,” EIA’s short-term energy outlook said in its report published on December 9, 2025. Falling oil prices are good for India, which imports more than 88% crude oil it processes.
Indian refiners need wind-down period for Russian oil halt, sources say
Indian refiners will need a wind-down period to complete Russian oil deals before imports .from that country can be halted, and they have so far not been ordered by the government. Indian companies have already booked cargoes loading in February and arriving in March , so a wind-down period would be needed to fulfil existing commitments, the sources say .
Qatar’s Al-Kaabi Warns AI Power Demand Could Spark LNG Shortage by 2030
Qatari Energy Minister Saad al-Kaabi on Monday warned that rising power demand from artificial intelligence could wipe out the global LNG surplus and push markets into deficit by around 2030, despite more than 100 million tonnes per year of new LNG capacity scheduled to come online this decade, Reuters reported. Al-Kaabi said AI-driven data centers are emerging as a material source of gas demand as governments and technology companies accelerate investment in large-scale computing infrastructure. Unlike traditional industrial loads, data centers require continuous power, increasing reliance on gas-fired generation in regions where renewables cannot yet provide consistent baseload supply. His comments come as Qatar advances a major expansion of its North Field LNG project, which will raise national capacity from about 77 million tonnes per year to roughly 126 million tonnes by the early 2030s. The expansion was designed to meet steady demand growth from Asia and Europe, rather than a sharp rise in electricity consumption linked to AI. LNG markets have spent the past two years focused on oversupply risks, with new export projects in the United States, Qatar, and Africa expected to add more than 100 million tonnes per year of capacity by the end of the decade. That outlook has weighed on prices and made buyers cautious about locking in long-term contracts. Industry forecasts have still pointed to underlying growth. Shell has said global LNG demand is likely to rise by around 3% per year, driven by coal-to-gas switching in Asia and Europe’s efforts to replace Russian pipeline supplies. Al-Kaabi’s warning suggests AI-related power demand could add a new layer of consumption that was not fully reflected in earlier projections. Gas-fired generation remains one of the fastest options for meeting large, reliable power needs, particularly in countries competing to host data centers and AI infrastructure. If that build-out accelerates, LNG demand could rise in markets that had been expected to plateau later this decade. Al-Kaabi said the risk is not immediate but lies in the second half of the decade. If AI demand expands alongside delays to new LNG projects or geopolitical disruptions, spare capacity could narrow quickly, tightening the market sooner than anticipated.