The Indian government is not ready to oppose Western sanctions against the Russian Federation and intends to comply with the oil price ceiling adopted by the G7 countries. This was reported by Bloomberg citing sources.
The Cabinet of India has officially announced that it will not support anti-Russian sanctions and will not limit the price of oil from Russia. But journalists’ interlocutors said that New Delhi is asking banks and merchants in the country to comply with the sanctions requirements of Western states.
One source said that Indian officials discussed the situation at length with the US and other G7 countries on the sidelines of the G20 summit.
Washington is happy with New Delhi’s purchase of Russian oil at a price below the Western ceiling, but will continue consultations with India, a senior White House source told Bloomberg.
The oil price cap for Russia was agreed by the G7 in September 2022 and amounted to US$60 per barrel. This is followed by EU countries, Australia and Switzerland. In response, Moscow banned oil supplies to these countries from February 1, 2023.
Against the background of the price cap, India increased its oil purchases from Russia. However, according to the news that Telegraph India newspaper cites sources, country officials have decided that they can support the border if the price exceeds $ 60 per barrel or if the West imposes secondary sanctions on countries that do not comply with the price ceiling.
Currently, the price of a barrel of Russian oil for India is 53-56 dollars.
The India Times wrote that the Russian Federation is India’s largest oil supplier and meets 25% of the country’s needs. Last December, 1.17 million barrels of crude oil were shipped from Russia to India every day. In December 2021, India received only 36.2 thousand barrels per day from Russia.
Reuters reported that in mid-December Moscow “overfilled the market” with its oil from Asia, sometimes selling raw materials at prices below the cost of Ural oil.
On March 11, the newspaper Novye Izvestia reported that Russian raw material export companies are facing difficulties in attracting funds from the sale of energy resources from India. This is due to the peculiarities of the local financial regulation that make withdrawing rupees from the country an extremely difficult task.
At the same time, by the end of 2022, India, along with China, has become one of the most important energy importers for Russia. In some months, New Delhi even surpassed Beijing in terms of raw material consumption from the Russian Federation. The article states that the main problem is that India prefers to buy Russian resources in exchange for the local national currency, the rupee.
“There is already a huge trade imbalance in Russian-Indian trade. India pays exporters in national currency and it is impossible to withdraw rupees from the country,” Professor, Doctor of Economics Igor Lipsits told NI.
On March 9, Bloomberg reported that the price of oil from Russia will continue to rise as there are more and more buyers from Asia. Russian oil grades Urals and ESPO, as well as fuel supplies, have increased in recent weeks, according to traders. The growing interest of the Chinese state and large private refineries and increased demand from India have pushed up the cost of Russian fuel.