INDIA DATA: India diversifies methanol supply as sanctions hit Iranian imports

India explored new methanol supply sources in 2025 after the US sanctions targeted several Indian importers suspected of trading Iranian petrochemical products, latest customs data release by the Indian government showed.

Indian methanol imports rose 13.5% year over year to nearly 3.4 million metric tons over 2025, the data showed. An overall increase in imports was largely driven by an expected rise in India's annual consumption, according to market sources.

The shift in supply patterns was a clear outcome of Indian buyers' efforts to maintain adequate methanol volumes to meet domestic demand and their resistance to trade in sanctioned Iranian material, market sources said.

The diversification saw India resume imports from Russia, receive first-time cargoes from Japan, and tap spot supplies from China as buyers sought alternatives to traditional Iranian sources that had previously supplied the market. Before the first round of sanctions that took effect July 31, India was importing at least 100,000 mt from Iran every month unless plant operations were disrupted in the winter months, as per several Indian market sources.

Supply shifts

India imported around 32,500 mt of Russian methanol in December 2025, marking the resumption of flows after nearly two years. The country last received Russian material in November 2023, when about 8,990 mt loaded from Finland arrived at Indian ports. Total Russian methanol imports were at 196,143 mt in 2022 and 147,115 mt in 2023, before logistical challenges and weak Indian netbacks curtailed trade.

Russian methanol began flowing to India in 2022 after tensions between Russia and Ukraine prompted key Russian producers to redirect cargoes to India as European buyers avoided Russian material due to the EU's unprecedented sanctions on seaborne crude oil and refined petroleum products in response to Russia's aggression against Ukraine.

Additionally, China emerged as another major supplier, sending at least 49,347 mt methanol to India during 2025 compared with zero in 2024. The spot cargoes helped fill supply gaps as the wider price differential to CFR China prompted Chinese sellers to capitalize on the open India-China arbitrage.

Platts, part of S&P Global Energy, assessed the CFR India methanol price at an average of $309/mt in December, down $5/mt from the November average of $316.20/mt, while CFR China methanol averaged at $246.5/mt in the same period, with the average spread to the CFR India marker at $63/mt.

India also recorded fresh methanol imports from Japan, with around 20,443 mt arriving in December 2025. The unprecedented flow came as Indian prices spiked to significant premiums over those in the rest of Asia, creating attractive netbacks for Japanese suppliers, market sources said. Malaysia similarly increased shipments to India during 2025, amid a stronger demand and attractive CFR India prices.

Platts assessed methanol CFR Southeast Asia at an average of $318/mt in December 2025, at about a $9/mt spread to the CFR India price. The price difference between CFR Southeast Asia and CFR India methanol was at $4/mt in November, Platts data showed

Meanwhile, Middle East suppliers retained their dominant position in the Indian methanol market, accounting for more than 85% of total demand in 2025. Oman remained the top supplier with 1.6 million mt, followed by Saudi Arabia at946,085 mt, Qatar at 328,932 mt, and Bahrain at 237,290 mt, the customs data showed.

Platts assessed CFR India methanol at $292.50/mt on Feb. 23, stable day over day, amid thin trade discussions.