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In view of the steep discount offered by Russia regarding crude oil, India's state-owned Indian Oil bought 3 million barrels, to which the United States responded by warning India that buying Russian oil means that the world's largest democracy is taking the wrong side in history.
For its part, India stressed that the country would continue to import energy from sources that best meet its interests, even if that means Russia.
Jen Psaki, White House Press Secretary, disclosed that countries buying Russian oil are supporting Russia's invasion of Ukraine, which, as she warned, is having a devastating impact. However, Psaki said the purchases would not violate U.S. sanctions.
In this regard, the Indian Foreign Ministry expressed that India's lawful energy transactions should not be involved in politics and that countries that are self-reliant in oil or those importing from Russia cannot plausibly favor restrictive trade.
According to Indian government sources, it has been necessary to exploit competitive sources of oil amid the current scenario in Ukraine, which has led to a spike in oil market prices worldwide. The sources remarked that recent Western sanctions on Moscow have exemptions to avoid the impact on Russia's energy imports, citing significant importers of Russian oil such as the Netherlands, Poland, Lithuania, Germany, Italy and France.
Indian refiners are buying deeply discounted crude oil from Russia (~Brent minus $25/b). It's a sign that more seaborne cargoes from Russia will find buyers. Opportunistic buying by India - here are their typical supply sources. #OOTTpic.twitter.com/X3CwCfkhXI
India, the world's third-largest energy consumer, has purchased 3 million barrels of Russian oil. According to sources, Russia offered a 27-30% discount compared to international rates, and India may soon buy another 15 million barrels of crude from Russia.
In talks between Russian Deputy Prime Minister Alexander Novak and Indian Oil Minister Hardeep Singh Puri, the Russian diplomat pointed out his country's interest in attracting more Indian investment into the Russian oil and gas sector and expanding Russian companies. The two nations have built a long-standing strategic partnership regarding the energy industry, with Indian and Russian companies having completed several joint projects since 2016.
High energy prices could cost India 1.6% of its annual gross national product, as the country imports about 85% of its crude oil needs, which amount to 5 million barrels per day. Most of India's imports come from the Middle East, with Iraq, Saudi Arabia and the United Arab Emirates among the leading suppliers. However, the United States has also become an important source of crude for India.