Top Trending News

Indian imports of Russian crude have kept prices from rising in the global oil market

New Delhi (India), December 30 (ANI): In the face of international scrutiny, India has strongly defended its substantial purchases of Russian crude oil since the start of the war in Ukraine.

A recent report from a parliamentary panel highlighted that all import deals were executed under Western sanctions imposed on Moscow for its involvement in the conflict, according to SP Global.

The report highlights that these purchases, totaling an estimated 1.95 million barrels per day (bpd), were essential to avoid potential chaos in the crude oil market and prevent a rise in crude oil prices. around 30 to 40 dollars per barrel.

According to the Ministry of Petroleum and Natural Gas, India’s increased imports of Russian oil after Russia’s invasion of Ukraine in February 2022 helped avert “havoc” in the global oil market. The ministry said if India had not increased its imports, global crude oil prices would have increased by around $30-$40 per barrel.

The parliamentary panel’s report quotes an oil ministry official as saying that Indian oil and gas companies meticulously comply with international laws and sanctions.

Importing Russian oil, despite currency and payment problems, has been deemed crucial to maintaining the stability of global oil prices.

The report highlights the strategic importance of these Russian crude imports, saying they not only benefit Indian consumers with lower retail fuel prices, but also play a role in improving the oil situation. global supply.

The official further justified these transactions, noting that Indian refiners complied with all price caps, rules and regulations prescribed in the financial field.

Despite economic sanctions complicating logistical arrangements for Indian buyers, such as the availability of vessels and insurance, the report outlines steps being taken to address these challenges.

Indian buyers, including large entities like Indian Oil Corporation, have opted for delivery-based arrangements, with sellers taking responsibility for delivering the crude oil with appropriate insurance coverage to discharge ports in India.

The parliamentary panel acknowledged the payment difficulties faced by Indian buyers due to economic sanctions, citing difficulties in processing payments for crude oil imports in US dollars through Indian banks.

However, he emphasized the meticulous adherence to international financial channels like SWIFT.

Russia remains a major supplier, contributing more than 35 percent of India’s total crude imports in October and around 1.58 million bpd in November.

Projections from SP Global Commodity Insights estimate that Russian crude imports will reach around 1.73 million bpd in 2023.

The report also highlights currency issues associated with crude oil imports, which account for about 25 percent of all merchandise imports.

In response, the Indian government explored the possibility of settling crude oil imports in rupees to mitigate the impact on the trade deficit.

The Reserve Bank of India has introduced additional provisions for invoicing, payment and settlement of exports and imports in rupees.

Responding to the need for diversification, the parliamentary panel recommended that the Oil Ministry consider further diversification of crude oil imports.

Currently, more than 60 percent of state refiners’ crude imports come from the Persian Gulf region.

The panel highlighted the importance of upgrading older refineries to improve their capabilities to process a wider variety of crude oil, thereby contributing to a more resilient and cost-effective import strategy for India. (ANI)

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button