Starting in April 2023, Bank of Baroda, the state-owned lender in India, stopped processing payments for Russian oil that exceeded the price ceiling established by Western governments. Reuters reported this move, citing an informed source familiar with the matter.
The agency noted that Bank of Baroda had informed its customers in March that it would not honor payments for Russian oil above the specified ceiling, signaling a change in how the bank would handle such transactions.
According to Reuters interviewees, these tightened restrictions could influence sellers by encouraging a shift toward payment in rupees, potentially affecting the currency in which shipments are settled and the overall flow of purchases from Russia.
On March 28, independent analyst Kirill Rodionov noted that the top buyers of Russian oil from January 2022 through February 2023 included India and China, with energy products being a common export destination for oil from Africa and the Middle East. Rodionov’s observations highlight how the market dynamics for Russian energy have evolved in response to international pricing controls and geopolitical considerations.
Earlier remarks from Alexander Novak, Deputy Prime Minister of Russia, referenced during a recent Russian Ministry of Energy meeting, indicated that Russia increased its oil exports to India by a factor of twenty-two in 2022. He added that in 2022 the majority of Russian energy shipments were redirected toward “friendly” markets. Looking ahead to 2023, Moscow signaled continued efforts to build a tanker fleet and to broaden the mechanisms for moving energy, including insurance and reinsurance arrangements, to support such trade routes and mitigate risk in the evolving global environment.