Russia Supplies 22% of India’s Crude Import
Oil field

Russia Supplies 22% of India’s Crude Import

Russia has become India’s largest oil supplier, surpassing Saudi Arabia and Iraq, as refiners buy up Russian crude oil offered at large discounts following European Union (EU) sanctions targeting Russia’s hydrocarbon sector, according to real-time energy cargo tracker Vortexa.

Since the outbreak of the Russia-Ukraine war on Feb. 24, India – the world’s third-largest oil importer – has taken a firm stance in its insistence in buying Russian oil that it is now selling at huge discounts despite the EU ban.

With 946,000 barrels daily in October, Russia provided India with the most crude oil in a single month. It provided 22% of India’s total crude oil imports, compared to Saudi Arabia’s 16% and Iraq’s 20.5%.

In October, global crude imports jumped by 5% compared to September, while those from Russia increased by 8%, according to Vortexa, an energy intelligence business with offices in Singapore and London that monitors oil and gas ships around the globe and offers freight and inventories analytics.

Indian imports of Russian crude by sea increased. In addition, India bought fuel oil from Russia at a record-breaking rate of 106,000 barrels per day in October.

As a result of the severe price cuts that followed the February invasion of Ukraine, Russia’s market share in India increased significantly from less than 1% in 2021.

Iran, Russia Plan to ‘neutralize sanctions

Iran and Russia announced joint plans ‘to neutralize sanctions’, Iranian Petroleum Minister Jawad Owji was quoted as saying by the Iranian Oil Company (NIOC) on Wednesday.

In a joint news conference with Deputy Prime Minister of Russia, Alexander Novak, ahead of the 16th Joint Economic Commission of Iran and Russia, Owji said, ‘there is now a strong will in the public and private sectors of both countries to neutralize the sanctions.’

Owji said that with the plentiful hydrocarbon resources of both countries, they can utilize their influence in the global market, and align their decision in coalition with the decisions of the Organization of the Petroleum Exporting Countries (OPEC) and its allies known as OPEC+.

Having met regularly in the past year, the Iranian petroleum minister said that relations between the two countries have never been so close, and urged that “this golden opportunity should be used to the fullest.’

Iran already has more than $4 billion in contracts with Russian majors for the development of oil and gas fields, Owji said.

‘In line with these contracts, there are more than $40 billion of memorandum of understanding with major Russian companies in various fields such as the construction of gas export pipelines to neighbouring countries, swaps of oil, gas, oil products and export of petrochemicals. In this regard, petrochemical products and catalysts were exported to Russia last month.’

Following its invasion of Ukrainian cities, Russia has been subject to many western sanctions from the US and the EU. Sanctions are aimed against Russia’s financial institutions, business sector, and oil and gas industry. Iran’s oil and financial sectors have also struggled under the years-long US sanctions due to its nuclear activities.

Under a nuclear deal known as the Joint Comprehensive Plan of Action (JCPOA), signed in 2015 by Iran, the US, China, Russia, France, the UK, Germany and the EU, Tehran committed to limit its nuclear activity to civilian purposes and in return, world powers agreed to drop their economic sanctions against Iran.

Iran stopped observing the nuclear deal when former US President Donald Trump unilaterally withdrew the US from it in 2018 and re-imposed sanctions on Iran. READ: Oil Prices Inch Higher over Supply Concerns

Since the election of Ebrahim Raisi as president last year, efforts have been made to resurrect the accord and lift restrictions on Iranian oil exports; however, disagreements between the key stakeholders have prevented the signature of the agreement. # Russia Supplies 22% of India’s Crude Import