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While Germany inks a $10-billion-plus energy deal with India, India is negotiating another crude oil deal with Russia.
As energy alliances shift as a result of Russia’s war on Ukraine, India is cutting deals on both sides of the divide.
On Monday, Germany and India signed $10.5 billion in bilateral agreements to boost green energy, as German Chancellor Olaf Scholz courts Indian support for the European Union’s plans to ban Russian oil.
At the same time, India and Russia are in talks over a deal for 20 million barrels of crude oil from Russian state-owned Rosneft, with India eyeing a heavy discount.
Talks now, according to Indian media, are over alternative payment mechanisms that would avoid sanctions.
According to The Tribune, New Delhi is hoping to “stabilize its economic engagement with Russia” despite the potential impact of sanctions.
“There is a possibility that these sanctions might impact us and that is why we are having inter-ministerial discussions and other conversations to see how we can keep our economic interactions with Russia stabilised and also to see how we can ensure our interests are not affected,” the daily quoted MEA spokesperson Arindam Bagchi as saying.
India has maintained “neutrality” on Ukraine, with its prime minister recently saying there could be no winner in this war.
While Washington has offered to help India diversify away from Russian oil, heavily discounted prices that have resulted from self-sanctioning have made deals with Moscow far too attractive for New Delhi to resist.
According to Reuters, in March and April, India purchased twice as much Russian oil as it did in all of 2021.
Elsewhere in the game of shifting energy alliances, Europe is seeking other potential partnerships in Asia, most notably in Japan, where an EU-Japan summit will take place next week.
By Charles Kennedy for Oilprice.com
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Charles is a writer for Oilprice.com