Delhi is world’s second largest purchaser of Russian crude, which is now cheaper than oil from Middle East
Delhi is world’s second largest purchaser of Russian crude, which is now cheaper than oil from Middle East
Russia is already working to circumvent the latest US sanctions to ensure India can continue to import high levels of cheap Russian crude oil, according to industry analysts.
Since the outbreak of the Ukraine war, India has become the world’s second largest purchaser of Russian crude oil, which has been heavily discounted due to the impact of western sanctions.
US-India relations have plummeted in recent months as Donald Trump has attempted to coerce India into halting its reliance on cheap Russian oil, accusing it of bankrolling Vladimir Putin’s war in Ukraine.
In August, Trump hit India with an punitive 25% tariff on imports into the US over their purchase of Russian crude. However, India refused to back down, maintaining that its purchase of Russian oil was a sovereign issue and that India’s energy policies would not be dictated by third countries. Trade negotiations between the two countries have since failed to reach any agreements.
Last week, the Trump administration once again upped the ante on India with threats to impose 500% tariffs and withdraw from several India-led global initiatives over ongoing Russian oil purchases.
It came as questions have been raised over the effectiveness of the latest US sanctions intended to disrupt the flow of cheap Russian oil to India. From the end of November, US sanctions were brought in to target any companies or refineries that purchased oil from Rosneft and Lukoil, Russia’s two largest oil exporters and the biggest sellers of oil to India.
Figures showed it has had an initial impact, with India’s imports of Russian oil dropping from an average of 1.7m barrels of Russian oil a day, mostly bought from Rosneft and Lukoil, to roughly 1.2m barrels a day in December – a decrease of around a third.
