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India is poised to purchase 15 billion barrels of oil from Russia as Moscow looks to evade Western sanctions. The move risks undermining western nations such as the United States that have imposed unprecedented sanctions on Moscow in response to President Vladimir Putin’s invasion of Ukraine.
Indian Prime Minister Narendra Modi and Putin are deepening their energy ties, as New Delhi evades Western sanctions on Moscow to import oil at discounted prices.
Since Western countries, including the US, UK, and EU began sanctioning large parts of the Russian economy and announced plans to phase out Russian oil, Putin has turned eastwards, to India and China.
According to Danil Bochkov, an expert on Russia and China: “India has purchased about 1.8 million barrels of Russian Urals oil.
“On Wednesday, India’s state-owned refinery Indian Oil Corporation (IOC) bought 3 million barrels of Russian Urals oil.
“India may import 15 million barrels of oil from Russia this year at a reduced cost.”
Price details were not immediately available, however sources told Reuters that the barrels of Russian Urals crude were purchased at a discount of $20-$25 a barrel, which is about £17 pounds.
At the moment, crude oil brent costs $118.77 (£90) per barrel
According to the head of the operational department of the Russian trade mission in India Evgeny Ostapkevich, Russia is only likely to increase the volume of oil that it supplies to India.
TASS reported him saying: “Taking into account the refusal of a number of countries to purchase Russian oil products, opportunities are opening up for Russian oil companies to increase the volume of supplies.
“It is reported that India may buy up to 15 mln barrels of oil from Russia before the end of this year,”
India’s central bank is in consultations on a potential rupee-ruble trade arrangement with Russia that would enable New Delhi to continue exports to Moscow despite western sanctions limiting international payment mechanisms.
The deal would allow India to avoid the impact of western sanctions on Russia and continue buying Russian energy and other goods.
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India meets 88 percent of its oil needs through imports.
From April 2021 to January 2022, India imported 176 million tones of oil, two percent of this volume, or 3.6 million tonnes were Russian oil supplies.
Modi has forged ahead with his efforts to secure a part of the Russian energy supply at lucrative prices, despite the West’s sanctions.
According to reports, when asked whether India would opt for Russian energy which is reportedly being offered at a “discount”, an informed source said, “We will take it.”
The official then clarified that this new energy partnership between Mr Modi and Putin will require a level of financial adjustment due to challenges created by US sanctions.
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