Exports of Russian crude oil to India have surged since the start of the month as sanctions bit in, forcing traders in Europe to avoid Russian cargos, the Financial Times reported, citing data from Kpler.
The average daily rate of Indian purchases of Russin crude has stood at 360,000 bpd, which was four times the rate of daily purchases last year, the report noted.
"Already committed oil cargoes from Russia that can't find buyers in Europe are being bought by India," Alex Booth, head of research at Kpler, told the FT. "Exports to India surged in March before any official announcement by New Delhi."
Russia is not traditionally a large supplier of crude to India, but sanctions have changed that. Because of them, Russian crude is trading at a deep discount, amounting to $25-30 per barrel, which has made it economical for India, despite normally high shipping costs, industry sources told the FT.
India imports more than 80 percent of the crude oil it consumes and has been seeking to diversify its sources, including by boosting the intake of Russian oil. The Western sanctions have shut off Russia's trade in U.S. dollars, but, according to reports, New Delhi and Moscow are discussing a payment arrangement using their own currencies.
The United States has made known its displeasure with India's neutral stance on the Ukraine war and its evident willingness to continue doing business with Russia. The latest sign of that displeasure came from White House Press Secretary Jen Psaki, who commented this week on India's plans to keep importing Russian oil.
"I don't believe this would be violating that [sanctions], but also think about where you want to stand," Psaki said. "When the history books are written in this moment in time, support for Russia – the Russian leadership – is support for an invasion that obviously is having a devastating impact."
By Irina Slav for Oilprice.com
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