Sources on buying oil from Russia

New Delhi: India’s legitimate energy deals should not be politicized, sources say amid reports that New Delhi is considering buying Russian oil at a cut rate following the post-conflict spike in global oil prices Ukrainian.

India is highly dependent on imports to meet its energy needs, nearly 85% of crude oil needs (5 million barrels per day) must be imported. Most imports come from Western Asia (Iraq 23%, Saudi Arabia 18%, United Arab Emirates 11%). The United States has also become an important source of crude oil for India (7.3%), sources said. Imports from the United States are expected to increase significantly in the current year, probably by around 11 percent. Its market share will be 8%, according to sources.

“Geopolitical developments have posed significant challenges to our energy security. For obvious reasons, we have had to stop sourcing from Iran and Venezuela. Alternative sources often come at a higher cost,” the sources said.

The sources further said that the spike in oil prices after the conflict in Ukraine has added to our challenges. The pressure for competitive sourcing has naturally increased.

“Russia has been a marginal supplier of crude oil to India (less than 1% of our needs, not among the top 10 sources). There is no G2G import deal,” the officials said. sources.

“Russian oil/gas is purchased by various countries around the world, especially Europe. 75% of Russia’s total natural gas exports are destined for OECD Europe (such as Germany, l “Italy, France). European countries (such as the Netherlands, Italy, Poland, Finland, Lithuania, Romania) are also big importers of Russian crude oil.”

Notably, recent Western sanctions against Russia have exceptions to avoid an impact on energy imports from Russia. Russian banks that are the European Union’s main payment channels for Russian energy imports have not been excluded from SWIFT, the sources say.

“India must continue to focus on competitive energy sources. We welcome such offers from all producers. Indian traders are also operating in global energy markets to explore the best options,” said the sources. They further stated that countries that are self-sufficient in oil or those that import themselves from Russia cannot credibly advocate restrictive trade.

According to some media, Indian Oil Corporation has purchased 3 million barrels of Russian crude oil, the first such transaction since Russia invaded Ukraine on February 24.

India, the world’s third-largest oil consumer and importer and one of the few countries not to condemn Moscow’s invasion of Ukraine, currently imports 80% of its oil, but only 2-3% of those purchases come from Russia. .

Meanwhile, the United States said India would not violate US sanctions by buying Russian oil at a discount, but added that such a move would put the world’s largest democracy on the “wrong side of the game”. ‘story”.

The United States banned all Russian energy imports following the Ukraine conflict.

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Posted: Friday, March 18, 2023, 2:54 PM IST