India is now staring at the possibility of an oil shock after the U.S. decided to implement sweeping sanctions on Russia's oil industry.

Indian Oil Corp (IOC) is seeking high-sulphur oil from the spot market in its first sour crude import tender since March 2022, expecting the latest U.S. sanctions to hit supplies from Moscow, trade sources said on Thursday.

It is India's first tender for sour crude imports since March 2022. IOC and other Indian refiners have significantly increased purchases of Russian oil over the past two years, taking advantage of discounted prices after the West imposed sanctions on Moscow over its full-scale invasion of Ukraine in 2022.

U.S. crude oil stocks excluding the Strategic Petroleum Reserve (SPR) fell last week to their lowest since April 2022 as exports rose and imports fell, the Energy Information Administration (EIA) said on Wednesday.

U.S. crude oil inventories fell for an eighth consecutive week amid declines in imports and domestic production, while product stocks saw further large weekly builds.