Russia crude imports to fall as Reliance denies January delivery

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WHAT WE’RE TRACKING TODAY

THIS AFTERNOON: India’s north enters the chip race — with subsidies, eyeing INR 30 bn in investments

Good afternoon, friends. India’s macro story is holding its stride, but the oil map beneath it is shifting.

The big story today: Indian refiners are bracing for a sharp drop in Russian crude as US pressure mounts. We spoke to an industry expert to understand what the loss of sanctioned barrels means — and why Middle East producers are poised to gain — just as Reliance denies claims of receiving fresh Russian cargoes in January.

ALSO- India is set to lap Gulf peers on growth, with GDP projected at 6.9% in FY 2027. Tax cuts, trade pacts, and domestic buffers will cushion the blow from global headwinds. In other macro news, services momentum cooled in December and inflation is tamed, for now.

All of that and more, below.

Watch this space

TRADE — State Bank of India (SBI), the sole Indian bank operating in Israel, has secured approval to settle bilateral trade with Israel in INR, Press Trust of India reports. Using the Special INR Vostro Account mechanism — the same architecture established with the UAE in 2023 — Israeli exporters can now receive direct payments in INR, effectively bypassing the USD for cross-border transactions.

This mirrors the INR settlement architecture already in place with the UAE, with India looking to push for a standardized INR corridor across its key MENA partners. With over 40k Indian workers in Israel, SBI is streamlining INR accounts to capture the flow of remittances.

An FTA catalyst: This precedes a high-stakes freetrade agreement between India and Israel, negotiations for which will take place later this month.

SEMICONDUCTORS — The northern state of Uttar Pradesh has implemented incentives to attract investments of INR 30 bn (USD 360 mn) or more from semiconductor manufacturers as part of efforts by the state to build a high-end manufacturing base, Hindu Businessline reports. It also approved standard operating procedures for Global Capability Centers as it sharpens its pitch as an investment destination.

Why it matters: If you are a MENA-based tech firm looking to set up a back-office or a fabrication facility in India, Uttar Pradesh just became significantly cheaper than Bengaluru or Hyderabad on an operational basis. By offering 10-year power and tax subsidies, the heartland state is trying to undercut the established tech hubs of southern India like Visakhapatnam and Thoothukudi.

YOU’RE READING EnterpriseAM MENA <> India, your C-suite briefing on the movement of trade, investment, people, and ideas along one of the world’s most exciting corridors. Every Monday, Wednesday, and Friday at 9am UAE, we dive deep into the business, finance, economy, and policy headlines and trendlines that will move markets and set the tone for your day.

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Data point

USD 8.5 bn — this was the value of institutional investments in the Indian real estate sector in 2025, a 29% y-o-y increase, riding a sharp year-end surge amid soaring domestic participation, as per Colliers India. Domestic institutions more than doubled deployments to USD 4.8 bn, amounting to 57% of inflows, while foreign inflows eased 16% to USD 3.7 bn.

IN CONTEXT- Gulf institutional investors are laser-focused on Grade A, income-generating office assets, specifically those ready to be packaged into Real Estate Investment Trusts, which alone drew USD 4.5 bn in 2025.

Happening this week

India and the EU will hold high-level talks in Brussels from 8-9 January to push forward negotiations on a long-negotiated freetrade agreement, as both sides look to resolve outstanding issues and accelerate closure, Press Trust of India reports. The agreement is likely to be signed around 26 January during a visit by European Commission President Ursula von der Leyen to New Delhi.

The big story abroad

Uh, did the US just *literally* steal Venezuela’s oil? Oil tankers are moving from the US towards Venezuela to begin loading stranded Venezuelan oil after US President Donald Trump said Venezuela will hand over some 30-50 mn barrels of oil to the US. The sale of the cargoes could be worth around USD 3 bn at current prices.

What he said: “That money will be controlled by me, as President of the United States of America, to ensure it is used to benefit the people of Venezuela and the United States,” Trump wrote in a post on his Truth Social platform.

^^ The must-read on the topic: Trump: Venezuela to turn over 30-50 mn barrels of oil to US

And the White House is now saying that military force is on the table in its bid to “acquire” Greenland. ““President Trump has made it well known that acquiring Greenland is a national security priority of the United States, and it’s vital to deter our adversaries in the Arctic region,” White House press secretary Karoline Leavitt said. “The president and his team are discussing a range of options to pursue this important foreign policy goal, and of course, utilizing the US military is always an option at the commander-in-chief’s disposal.”

Her remarks came after White House Deputy Chief of Staff Stephen Miller channeled his inner Balon Greyjoy, saying, “Nobody’s going to fight the United States militarily over the future of Greenland. … We live in a world, in the real world … that is governed by strength, that is governed by force, that is governed by power. These are the iron laws of the world since the beginning of time.” See more in the New York Times and the FT.

Closer to home:

Saudi Arabia has opened up its capital markets to foreign investors in a move set to bring in more liquidity ahead of a deep 2026 IPO pipeline.
The Qatar Investment Authority participated in Elon Musk’s xAI’s USD 20 bn series E funding round, alongside Nvidia and Cisco. (Reuters)
Clashes between civilians and police in Iran amid a wave of protests that took the country by storm as of last week have left 29 dead and more than 1.2k people arrested. (Bloomberg)

Market watch

Deutsche Bank topped the league table for arranging USD bonds for Indian borrowers in 2025, displacing Standard Chartered’s 17-year reign, but the win comes in a declining market, Bloomberg reports.

Indian companies’ USD bond issuance plummeted 37% to USD 8.3 bn in 2025 as a weak INR and punishing hedging costs pushed corporate treasurers to return home. While offshore sales withered, local currency debt hit a record USD 151 bn.

Deutsche Bank secured its lead by leaning into high-stakes agreements for issuers like Vedanta Resources and Muthoot Finance. It acted as sole arranger for the country’s largest private credit financing of USD 3.4 bn for the Mumbai-based conglomerate Shapoorji Pallonji.

Why this matters: For MENA-based allocators and bankers, the standard Indian USD bond is becoming a rarity. The market is bifurcating — issuance is moving onshore to the INR market, while the offshore space is emerging as a playground for private credit plays. Deutsche Bank’s ascent suggests that success in India’s bond market now demands a risk appetite for complex credits that traditional incumbents appear to be ceding.

Circle your calendar

German Chancellor Friedrich Merz will make his first official visit to India from 12-13 January, as New Delhi looks to strengthen economic engagement with Europe amid growing trade frictions with Washington. The two-day trip is expected to focus on trade, investment, defence, and technology cooperation, according to a foreign ministry statement.

Check out our full calendar on the web for a comprehensive listing of upcoming news events, national holidays and news triggers.

ICRA sees sharp drop in Russian crude imports as Reliance denies reports about January deliveries

Indian refiners are bracing for a substantial drop in Russian crude supplies, with about 60% of sanctioned barrels falling out of the market, Prashant Vashisht, VP & co-head of ICRA India told EnterpriseAM as US pressure and steep tariffs linked to the trade continue. “Middle East producers would be key beneficiaries of any reduction in volumes procured from Russia,” Vashisht said.

(** Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

Reliance Industries — India’s largest importer of Russian crude — denied reports that its refinery will receive Russian cargo deliveries for January, according to a post on X. The Mumbai-based conglomerate was responding to a Bloomberg report based on Kpler data that suggested Russian oil tankers were bound for its Jamnagar refinery.

Imports under pressure: Stricter US and EU sanctions against Russian oil majors Rosneft and Lukoil are already slowing crude flows to India.

A structural slowdown in Russian crude

Russia’s share of India’s crude purchases has fallen from nearly 40% at its post-war peak to less than 25% as of early January, driven in part by Reliance halting Russian oil purchases following the latest US sanctions, Economic Times reports.

How refiners are adjusting: The decline in Russian inflows is likely to persist as sanctioned barrels disappear from India’s import basket, Vashisht said. While refiners will continue to source from non-sanctioned entities, the overall volume of Russian cargoes will remain lower even as discounts have widened to high single digits, Vashisht noted.

Russia’s share in India’s crude purchases rose from 22% in FY 2023 to 36% in FY 2024 and FY 2025, before easing to 34% in 1H FY 2026. But India’s refining system is diversified, Vashisht noted. “Indian refiners procure from a variety of sources globally as most refineries are able to process varieties of crudes.” While India can substitute Russian barrels with supplies from the Middle East, Africa, or South America, “the import bill for crude oil would increase,” adding pressure on retail prices.

Why it matters: Despite the ongoing recalibration, Vashisht stressed that India’s large refiners have the scale and logistical reach to adjust quickly. “Indian refiners will buy from sources that make the most economic and commercial sense and are not sanctioned.” While proximity has historically favoured Middle East barrels, Indian refiners also source from Brazil, Africa, and the US when commercially viable.

The near-term trend, however, points to deeper Middle East reliance. Any sustained reduction in Russian barrels will reinforce the Gulf’s weight in India’s energy security matrix, with pricing, freight dynamics, and sanctions compliance all shaping how refiners buy barrels through 2026.

What to watch: Indian authorities have asked refiners to submit weekly disclosures of Russian and US crude intake to provide primary import data to Washington amid ongoing and delayed trade discussions, Reuters reported last week.

India’s downstream earnings in oil and gas sector jump 17%, securing crude buying power as domestic output falters

India’s energy sector is flashing a two-speed signal to Middle East suppliers: While refining giants are set to post strong revenues — securing their ability to pay for crude imports — the much-hyped city gas sector is seeing volume growth slow, raising questions about the pace of LNG adoption.

India’s downstream players are expected to see aggregate EBITDA rise about 17% y-o-y in the October-December quarter (3Q FY2025/26), ANI reports, citing a sector note by brokerage firm Nuvama.

Fuel retail margins remained elevated but moderated compared to last year. Average diesel retail margins were around INR 5.5 per liter, down roughly 37% y-o-y, while petrol margins stood at about INR 10.7 per liter, a 17% y-o-y drop, the newswire added.

(** Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

Why it matters: Stronger balance sheets for Indian refiners mean stability for their primary crude suppliers in Saudi Arabia, the UAE, and Iraq, even as global crude prices soften.

The gas warning: For Qatar and the UAE — India’s key LNG suppliers — the quarter offers a reality check. While City Gas Distribution (CGD) earnings are up 5%, Nuvama flagged that volume growth, particularly in CNG, remains “modest.”

The disconnect: The sluggish immediate growth contrasts with the government’s aggressive target to expand to 18k CNG stations by 2032. If volume uptake lags behind infrastructure rollout, Indian buyers may remain price-sensitive on spot LNG cargoes, dampening hopes for a rapid demand spike.

India’s 6.9% GDP outlook keeps it well ahead of Saudi and UAE even as domestic engine taps the brakes

India is set to remain the fastest-growing major economy in the India-MENA corridor, with GDP projected to expand 6.9% in FY 2026-27 (ending 31 March), according to India Ratings & Research. This is a step down from the 7.4% estimated for FY 2026, as base effects, weaker global trade, and climate risks temper momentum. Looking ahead to 2026, India significantly outstrips its primary Gulf partners, with the UAE expected to grow at 5.2% and Saudi Arabia at 4.6%.

Internal stabilizers to soften shocks: Domestic buffers — including GST and income tax cuts as well as new trade agreements with Oman, the UK, and New Zealand — are expected to help the economy absorb external shocks, particularly from US tariffs.

In other macroeconomic news

Near-term signals are mixed: HSBC’s India Services Purchasing Managers’ Index slipped to an 11-month low of 58.0 in December, indicating slower expansion. Meanwhile, export orders accelerated amid steady overseas demand, a large part of which has been routed through Gulf trade and services corridors, while benign inflation kept cost pressures contained.

A friction point? More concerning for firms looking at the talent corridor is that hiring has stalled for the first time in 42 months. While the macro story remains robust, the operational situation in high-value sectors like IT and professional services — critical to the India-UAE CEPA — is facing a period of consolidation.

(** Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

Indian property advisory PropertyPistol scales UAE business

Mumbai-based property advisory firm PropertyPistol has expanded its Dubai desk after facilitating nearly INR 30 bn in residential property transactions in the UAE over the last three years, according to a press release.

UAE footprint: PropertyPistol provides cross-border advisory services for Indian buyers in Emirati real estate. The firm facilitated the sale of up to 800 residential units in Dubai worth INR 20 bn, as Indian buyers double down on the UAE property market.

What Venezuela means for regional oil + where the risk actually went

The usual script of conflict driving oil shock has been flipped, with markets barely moving after the US capture of Venezuela’s Nicolas Maduro. Brent rose only about USD 1 / bbl, with analysts noting that in a supplied global market, Venezuela’s turmoil poses little immediate threat to output. That muted reaction reflects the reality that oil markets are in oversupply — with or without Venezuela. The International Energy Agency has been sounding the glut alarm for months, saying that supply is set to exceed demand by some 4 mn bbl / d this year.

Even under optimistic scenarios, new barrels would take years to materialize. JPMorgan sees Venezuelan production reaching 1.3-1.4 mn bbl / d within two years and up to 2.5 mn bbl / d over a decade, with a limited market impact — roughly USD 4 / bbl downside to 2030 prices.

While global markets are broadly unmoved, the outlook for our neck of the woods is mixed. With uncertainty on how the long-term movements will shake out, Egypt, Saudi Arabia, and the UAE will each have different angles to watch for.

Who wins and who bleeds

For Egypt, it’s cheaper crude and fiscal breathing room: Every USD 5 / bbl drop in Brent cuts subsidy costs by roughly EGP 30 bn, easing fiscal pressure in the near term, according to CI Capital calculations. Energy subsidies still make up about 90% of total subsidies, but that share is set to fall to some 30% by this year as price liberalization continues.

A sharp drop in Brent would hit Saudi Arabia hard: Lower prices would squeeze fiscal capacity, drain liquidity, and weigh on sentiment. Saudi’s fiscal breakeven sits around USD 87 / bbl, according to CI’s estimates, leading to more strain on public finances and heavier reliance on external borrowing. That’s still far higher than the USD 60 / bbl range we’re currently sitting at.

Balance for the UAE: The country offers stability through low breakeven and diversified revenue — the reason why it remains a credit market darling. Non-oil activity makes up roughly 75% of GDP, and the fiscal breakeven oil price sits near USD 48 / bbl.

A narrow window?

Venezuelan barrels don’t compete head-on with most Middle Eastern crude. They’re heavy and sour, putting them in a different lane than the light and medium grades that dominate Gulf exports. Refineries that want Venezuelan crude are highly specialized, and are mostly in the US.

This opens the door for US refiners to take in more Venezuelan crude — easing reliance on pricier Canadian heavy barrels. The flipside is that barrels would likely be pulled away from China, which has taken most of Caracas’ exports since US sanctions kicked in.

Those volumes are marginal in China’s overall balance and easy to replace — and replacement matters. If Venezuelan barrels are directed to the US, China will have to look elsewhere, and the most obvious substitute is the Middle East.

The window: Saudi Arabia and Iraq sell some heavier grades that can be snatched up by China, with Middle Eastern producers still having the edge on logistics, reliability, and scale. Venezuela’s supply is constrained, operationally messy, and politically fragile.

The macro view: Where the risk actually went

Capital moved first into credit: After Vice President (and former Oil Minister) Delcy Rodriguez was sworn in as interim president, investors wasted no time piling into Venezuelan assets. The government’s and the state oil company’s defaulted sovereign bonds surged some 30% in a single day as regime-change hedges went into overdrive.

Equities followed: Big refiners such as Marathon Petroleum and Phillips 66 jumped 5-7%. Oilfield services — the ones who actually drill — outperformed with SLB and Halliburton surging 7-8%. Majors also moved, with ExxonMobil, Chevron, and ConocoPhillips gaining 2-4%.

The move effectively puts oil collateral pledged to China in “US hands,” weakens Russian oil’s strategic relevance, and creates a long runway for US refiners and oil-services firms, Micheal Burry, the Big Short investor, said. Valero — whose Gulf Coast refineries were built for Venezuelan heavy crude — jumped some 10%, with Burry doubling down on the stock.

Why this matters: It marks a shift in how markets price geopolitical risk, which had been largely absent from commodity markets during the glut. A decade ago, the ouster of an Opec strongman might have sent oil prices skyrocketing, but defaulted bonds are in demand and energy stocks are rallying, while oil itself yawns. Traders see Venezuela’s upheaval as a credit-and-equity play — rather than a supply disruption to panic over — migrating the risk premium away from commodities and into market assets.

MARKETS THIS MORNING-

It was a mix of red and green for Asia-Pacific markets this morning, weighed down by defense stocks falling after two days of gains. South Korea’s Kospi was trading up, while most other markets were in the red in early trading. Meanwhile, US stocks rallied to record highs overnight but futures are currently trading flat.

Sensex	84,775	-0.3% (YTD: -0.1%)
NIFTY 50	26,106	-0.9% (YTD: -0.3%)
ADX	10,022	+0.2% (YTD: +0.2%)
DFM	6,211	+0.4% (YTD: +2.7%)
Tadawul	10,415	+1.2% (YTD: -0.7%)
EGX30	41,543	+2.1% (YTD: -0.7%)
Boursa Kuwait	8,254	+0.6% (YTD: -1.1%)
QSE	11,009	+0.2%x% (YTD: +2.1%)
S&P 500	6,944	+0.6% (YTD: +1.5%)
FTSE 100	10,072	-0.5% (YTD: +2%)
Euro Stoxx 50	5,918	-0.2% (YTD: +2.4%)
Brent crude	USD 60.2	-0.81%
Natural gas (Nymex)	USD 3.48	+4%
Gold	USD 4,473	-0.7%
BTC	USD 91,880	-1.6%

The values in the table above are listed according to the market position as of 3:30pm IST / 2pm GST.

CALENDAR

2026

JANUARY

10-18 January (Saturday-Sunday): New Delhi World Book Fair, Pragati Madan, New Delhi.

12-13 January (Monday-Tuesday): German Chancellor Friedrich Merz’s first Official India Visit, Ahmedabad and Bengaluru.

19-20 January (Monday-Tuesday): International Crop Science Conference and Exhibition, Le Méridien Conference Center, Dubai.

26 January (Monday): Republic Day (Public Holiday).

27 January (Tuesday): India-EU Summit (to potentially finalize FTA), New Delhi.

27-30 January (Tuesday-Friday): India Energy Week, ONGC Advanced Training Institute, Goa.

30 January-1 February (Friday-Sunday): India Agri Expo, Ludhiana Exhibition Center, Punjab.

31 January (Saturday): Commencement of Budget Session 2026, Parliament of India, New Delhi.

FEBRUARY

1 February (Sunday): Union Budget 2026-27, Parliament of India, New Delhi.

3-6 February (Tuesday-Friday): ChemTech World Expo, Jio World Convention Center, Mumbai.

9-10 February (Monday-Tuesday): Pune International Business Summit (PIBS), SL Kirloskar Convention Center, JW Marriott, Pune.

14-18 February (Saturday-Wednesday): IHGF Delhi Fair (Spring), New Delhi.

19-20 February (Thursday-Friday): India-AI Impact Summit, Bharat Mandapam, New Delhi.

25 February (Wednesday): World Sustainable Development Summit, Taj Palace, New Delhi.

27 February (Friday): First GDP growth data with revised 2022-23 base year.

MARCH

4 March (Wednesday): Holi (Public Holiday).

12 March (Thursday): ET Entrepreneur Summit & Awards, Bengaluru.

19-22 March (Thursday-Sunday): Bharat Urja Manthan – Global Energy Conclave, New Delhi.

20 March (Friday): Eid Al Fitr (Public Holiday).

23-25 March (Monday-Wednesday): Indiasoft: International IT Exhibition & Conference, New Delhi.

23-25 March (Monday-Wednesday): Smart Cities Expo, Bharat Mandapam, New Delhi.

23-25 March (Monday-Wednesday): PlastiWorld India, Jio World Convention Center, Mumbai.

31 March (Tuesday): Mahavir Jayanti (Public Holiday).

Signposted to happen sometime in March 2026

Election Commission of India is expected to announce polling dates for elections in the states of Tamil Nadu, Kerala, West Bengal, Assam, and the union territory Puducherry.

APRIL

3 April (Friday): Good Friday (Public Holiday).

23-25 April (Thursday-Saturday): Rail & Metro Technology Conclave, Bharat Mandapam, New Delhi.

29 April-2 May (Wednesday-Saturday): Bharat Buildcon, Yashobhoomi, Dwarka, Delhi.

7-10 April (Tuesday-Friday), India Rubber Expo, ITPO, Pragati Maidan, Delhi.

MAY

1 May (Friday): Buddha Purnima (Public Holiday).

26 May (Tuesday): Eid Al Adha (Public Holiday).

JUNE

24-25 June (Wednesday-Thursday): India Homeland Security Expo, Bharat Mandapam, Pragati Maidan, New Delhi.

26 June (Friday): Muharram (Public Holiday).

Signposted to happen sometime in 1H 2026:

Signing of India-Qatar Freetrade Agreement (details yet to be announced);
India-EU Trade and Technology Council Ministerial Meeting, Brussels, Belgium.

AUGUST

15 August (Saturday): Independence Day (Public Holiday).

26 August (Wednesday): Prophet Mohammad’s Birthday (Public Holiday).

OCTOBER

2 October (Friday): Gandhi Jayanti (Public Holiday).

20 October (Tuesday): Dussehra (Public Holiday).

NOVEMBER

24 November (Tuesday): Guru Nanak Jayanti (Public Holiday).

DECEMBER

8-11 December (Tuesday-Thursday), Expand North Star, Dubai.

25 December (Friday): Christmas Day (Public Holiday).

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