Oil News: Oil Demand in Focus as India Mulls Cutting Russian Crude Imports

Crude Oil Prices Steady as Supply Uncertainty Deepens on India-Russia Rift and IEA Data Gap

Light crude oil futures are holding within Tuesday’s wide trading range for a second straight session, with prices consolidating just above key downside levels. The market is currently digesting mixed signals—from geopolitical pressure on Russian crude exports to a deepening data gap in global supply forecasts—that have left traders cautious and directionless.

At 12:40 GMT, Light Crude Oil Futures are trading $58.60, up $0.33 or +0.57%.

India’s Russian Oil Imports in Question as Pressure Mounts

Traders are watching closely after U.S. President Donald Trump claimed Indian Prime Minister Narendra Modi pledged to halt Russian oil imports, a move that would disrupt flows from India’s top crude supplier. While New Delhi has yet to confirm any such commitment, multiple Indian refiners are reportedly preparing for a gradual cutback.

Any meaningful reduction in Indian purchases of Russian barrels would likely shift demand toward other suppliers, providing bullish support to global benchmarks. Market analyst Tony Sycamore noted the loss of a major Russian crude buyer would be “a positive development” for oil prices.

Adding to supply concerns, ongoing Ukrainian drone strikes have forced Russian refiners to postpone maintenance, with outages reported at the Saratov and Ufaneftekhim plants. Meanwhile, new UK sanctions targeting Russia’s Rosneft, Lukoil, and shadow fleet tankers could further constrain Russian exports.

IEA’s Missing Barrels Raise Questions Over Bearish Oil Outlook

The International Energy Agency continues to forecast a major global supply glut, projecting a surplus of 2.35 million barrels per day (bpd) in 2025 and 4 million bpd in 2026. However, the IEA has acknowledged it cannot account for 1.47 million bpd of oil in its August balance sheet—equivalent to 1.4% of global demand.

This “missing barrels” discrepancy significantly muddies the supply outlook. Depending on where the unaccounted oil is, the true market surplus could be as low as 500,000 bpd or as high as 3.5 million bpd—introducing broad uncertainty that complicates price expectations.

Analysts suggest the blind spot may stem from surging seaborne oil movements, particularly involving heavily sanctioned Russian, Iranian, and Venezuelan crude transported via shadow fleets. Additionally, China’s opaque crude stockpiling—estimated to have added 110 million barrels from April to August—adds to the challenge of pinpointing true inventory levels.

Crude Oil Outlook: Bearish Bias Persists but Key Support Holds

Despite bullish developments around Russian supply risk and potential shifts in Indian buying behavior, sentiment remains tilted to the downside due to the IEA’s oversupply projections and opaque demand data.

Technically, the market is in consolidation, but bearish momentum may resume if prices break below $57.68, potentially targeting long-term support at $55.74. The recent bearish crossover of the 50-day and 200-day moving averages reinforces downside risk.

Short-term forecast: Bearish, unless geopolitical disruptions translate into measurable tightening of physical supply.

More Information in our Economic Calendar.