India in talks to increase Russian oil imports
As international players refuse to engage with Moscow over its invasion of Ukraine, India is aiming to increase its Russian oil imports, with state-owned refiners willing to absorb more steeply discounted supplies from Rosneft PJSC.
According to persons familiar with the firms’ procurement intentions, state processors are working together to finalise and secure fresh six-month supply contracts for Russian oil to India. Cargoes are being sought from Rosneft on a delivered basis, with the vendor handling transportation and insurance, they claimed.
If these supply arrangements are reached, they will be independent of the supplies that India presently receives from Russia under existing agreements. The persons who requested not to be identified because the conversations are private claimed that details on quantities and price are still being negotiated with Indian banks poised to fully fund all shipments. They noted that as large international merchants such as Glencore Plc wind down their deals, Indian refiners would increasingly purchase straight from Russian enterprises such as Rosneft.
Indian Oil Corp, Hindustan Petroleum, and Bharat Petroleum are state refiners, while Reliance Industries and Nayara Energy, which is partially controlled by Rosneft, are private refiners. Procurement for both public and private enterprises is handled independently. When questioned about the situation, spokespeople for the three main state-owned firms couldn’t immediately respond.
Indian refineries, both public and private, have increased their purchases of Russian crude as a result of US, UK, and European Union sanctions and trade restrictions, which have driven most purchasers to leave and offer levels to plummet. Last month, an unprecedented quantity of Russian oil was on its way to India and China while European customers sought substitutes, looking as far as the United Arab Emirates for alternatives. Since late February, when Russia invaded Ukraine, the resulting fear and rerouting of global oil supplies have boosted oil by more than 20%.
According to the sources, the projected increase in Russian crude purchases will have an impact on the South Asian country’s spot imports. According to Bloomberg projections based on trade data, India purchased more than 40 million barrels of Russian oil between late February and early May, which is roughly 20% higher than flows for the entire year of 2021. According to statistics, Russian oil shipments into India in May were 740,000 barrels per day, up from 284,000 barrels in April and 34,000 barrels a year ago.