India has purchased greater than twice as a lot crude oil from Russia within the two months since its invasion of Ukraine because it did in the entire of 2021, in line with Reuters calculations, as Indian refiners snapped up discounted oil that others have shunned.
Refiners in India have positioned orders for a minimum of 40 million barrels of Russian oil because the invasion on Feb. 24, Reuters calculations based mostly on info from crude tenders and merchants present. The purchases are for loading within the June quarter.
That compares with whole imports of Russian oil into India of 16 million barrels in the entire of final yr, in line with Reuters calculations.
The world’s third largest oil importer and shopper ships in over 85% of its crude oil wants of 5 million barrels per day (bpd). Its refiners are shopping for cheaper Russian oil to partially offset the influence of upper official promoting costs of some producers like Saudi Arabia, firm sources mentioned.
“We try to insulate consumers as much from price shocks as we can, but we need to protect our profits as well… so we are buying Russian oil,” an official at one refiner, who declined to be named, mentioned.
According to Reuters calculations, purchases of Russian barrels by non-public refiners Reliance Industries and Nayara Energy outstrip imports by state refiners Indian Oil Corp , Hindustan Petroleum Corp, and Bharat Petroleum Corp.
Reliance has bought a minimum of 15 million barrel of Russian oil to date for the June quarter, commerce sources mentioned final week. Reliance didn’t reply to a request for remark at the moment.
Nayara Energy, half owned by Russia’s high producer Rosneft , has bought 8 million to 9 million barrels of Russian crude for loading in April-May, commerce sources mentioned. Nayara didn’t reply to a Reuters electronic mail in search of feedback.
Western sanctions towards Russia since its invasion of Ukraine, which Moscow calls a “special operation”, have prompted many oil importers to shun commerce with Moscow, pushing Russian crude’s low cost to different grades to document ranges.
While New Delhi has referred to as for an instantaneous ceasefire in Ukraine, it has not explicitly condemned Moscow’s actions.
Defending India’s oil imports from Russia, the nation’s oil minister Hardeep Singh Puri on Friday mentioned that India’s purchases from Russia are a minuscule fraction of the nation’s total oil wants.
Indian corporations are shopping for Russian oil on a delivered foundation, with sellers arranging for transport and insurance coverage.
Washington has already mentioned it doesn’t object to New Delhi shopping for Russian oil under market charges, however warned towards a steep rise in imports as that might hamper the U.S. response to the conflict in Ukraine.
Analysts mentioned India’s Russian oil imports could taper off as a full-scale implementation of the European and U.S. sanctions from mid-May and late June may hit logistics.
“Indian refiners’ capacity to process Russian oil is limited, and also there could be logistic challenges like insurance, tankers and payment mechanism once full European and U.S. sanctions against Russian kick in,” mentioned Giovanni Staunovo, commodity analyst at UBS Group AG.
Already underneath strain from sanctions, some buying and selling homes are scaling again their dealings in Russian oil, he mentioned.
Source: www.financialexpress.com”