India turns to Libyan oil as U.S. tightens grip on Russian crude

Libya’s oil is gaining renewed traction on the global market, with India increasingly turning to spot shipments from the North African producer amid mounting U.S. pressure to curb Russian energy imports.

Bloomberg reported Sunday that Indian refiners—particularly state-owned firms—have scaled back purchases of Russia’s Urals crude for October-loading cargoes and are instead sourcing barrels from Libya, the UAE, and Nigeria. The shift reflects growing geopolitical headwinds as Washington intensifies its campaign to squeeze Moscow’s oil revenues and hasten an end to the war in Ukraine.

The realignment is already visible in global benchmarks. The Brent-Dubai spread, a key measure of the pricing strength of Middle Eastern crude against international Brent, has narrowed sharply to just 60 cents per barrel, down from $3.90 at the end of June. Analysts say the tighter spread signals a scramble among Asian buyers for Middle Eastern and medium-grade crudes—grades where Libya, with its sweet, high-quality output, stands to benefit.

For Libya, the world’s holder of Africa’s largest proven oil reserves, India’s pivot represents more than a commercial opportunity. It highlights the country’s growing relevance as refiners seek alternatives to Russian supplies, especially in a volatile market reshaped by sanctions, wars, and shifting alliances.

India, the world’s third-largest oil importer, has been one of Moscow’s biggest energy customers since Western sanctions over Ukraine upended global trade flows. But in recent weeks, state-run refiners have scaled back Russian purchases under tightening U.S. scrutiny, turning instead to the spot market for North African and Gulf barrels.

Energy traders say this trend, if sustained, could strengthen Libya’s foothold in the Asian market and boost its oil revenues at a time when global supply routes are being redrawn.