Despite increasing pressure from sanctions and frequent attacks on export infrastructure, Russian Urals crude oil bound for India is trading at a tighter discount to Brent. Four market sources told Reuters that for October loading, Urals crude is now priced about US$2–$2.50 per barrel below Brent, narrowed from about US$3 in previous months.

This shift is driven by recent Ukrainian drone strikes on Russian pipelines and ports that have disrupted shipping flows. To avoid exposure, Russia is rerouting exports via Western ports. Additionally, freight costs from Baltic ports to India have climbed sharply—expected to reach US$6.5–7 million per voyage in October, up from US$5.5–6 million in September

Tighter enforcement of EU/UK sanctions and restrictions on ships and insurance for vessels thought to be abusing sanctions regimes (“shadow fleet”) have reduced options and increased transport risk. Despite this, Indian refiners continue importing Urals crude due to its favorable economics. Changes in freight and pricing suggest downstream refining margins in India could come under pressure. Refineries must adjust their crude sourcing strategy to factor in higher shipping costs and evolving legal risk.