How much, how much, how: what you need to understand about the growth of India’s purchases of oil from Russia
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Despite continued Western calls for India to distance itself from Russia in the aftermath of the attacks on Ukraine, Delhi has more than doubled its purchases of Russian oil compared to last year.
The Indian government in defense of the government that for a whole month buys less oil from Russia than Europe in one day.
Why is India buying more Russian oil?
India took advantage of preferential prices offered by Russia at a time when world energy prices were being explained.
The United States admits that there is no special regime of anti-Russian meetings on the part of India, but reminds that the general support for Russia means the frequency of its military aggression.
During a visit to Delhi in March this year, British Foreign Secretary Liz Truss board India beware of depending on Russia. At the same time, Russian Foreign Minister Sergei Lavrov also came to India on a visit.
He assured that Russia was ready to accept favorable conditions for importing any resources and goods, but warned that payment should be made in rubles.
Where does India get its oil from?
India ranks third in the world in oil consumption after the US and China. The country imports more than 80% of deliveries.
According to research group Kpler, in 2021 the share of Russian oil is only 2% of the total. We are talking about 12 million barrels of Urals sour oil.
The main exporters of oil to the Indian market last year were the countries of the Middle East. A significant share also fell on the United States and Nigeria.
In January-February of this year, India did not purchase a single barrel from Russia. But contracts for the purchase of Urals, covering March, April, May and June, according to the Kpler group, exceed 26 million barrels in total, and this is twice as much as for the whole of last year.
How much does India pay?
After the invasion of Russian troops in Ukraine Some decisions and decisions of the energy company are completely elected from Russian carriers, with regard to falling prices, in particular, in the Urals.
The exact price offered by Russia in India is unknown, but oil analysts believe that the decline in Urals against Brent oil, which is usually taken as the basis for the price structure, is $30 per barrel.
Typically, these two grades of oil are sold at approximately the same price. But in March, the price in the Urals fell so much that the difference between each reached its maximum value.
“Therefore, India is likely to buy at least part of this [российской] oil at a discount,” said Kpler analyst Matt Smith.
Side effects
Despite an attractive meeting, Indian refiners are facing the challenge of a global solution being imposed on Russia’s banks.
This very often interrupts trade cooperation.
One option that India is considering is a currency payment system in which Russia would pay Indian exporters in rubles rather than dollars or euros.
The US has made it clear that it can support the ruble or undermine the dollar-based financial system.
Where else can India buy oil?
Since February of this year, India has significantly increased its purchases of American fruits, according to Refinitiv, an analytics company.
However, they believe that the party cannot maintain such a level of sales for a long time, since the United States is increasing the volume of oil to replenish, which were previously purchased in Russia.
The United States completely refused to import Russian oil, gas and coal in connection with the Russian attack on Ukraine.
In the near future, trade between India and Iran, which was interrupted three years ago because of America, imposed on Iran, may resume.
Prior to this, a barter trade mechanism worked between Delhi and Tehran, and the parties hope for a negative return.
This will depend on how quickly the issue of the Iranian nuclear program is resolved. Since last November, about 10 rounds of negotiations have been held in Vienna with the participation of Iran, the United States, the European Union, Russia and several European countries.
The essence of the deal: Iran refuses to work on the nuclear program. The signing of the conference has already been canceled several times.