New Delhi is said to be in talks with Moscow to supply oil at discounted prices, Reuters reported on Wednesday, citing an unnamed senior Indian government official.
He told Reuters on May 25 that “we will buy cheap oil from Russia” and that the Indian government “has not yet agreed on the terms of the discount”.
“Work continued to create a rupee and ruble trading mechanism to facilitate the transaction, amid concerns that common payment routes could be blocked due to Western sanctions against Moscow, including banks,” the source said.
“Without going into details, the official added that the final decision has not yet been made and all possible payment methods for the goods are still being discussed,” Reuters said.
India, the world’s third-largest oil importer, currently buys crude at an average price of over $100 per barrel. On May 4, Bloomberg reported that New Delhi is seeking shipments of Russian oil “under $70 per barrel delivered to offset additional hurdles, such as funding for acquisitions.”
“As India seeks to get deeper discounts on Russian oil to offset the risk of a deal with the OPEC+ producer, other buyers are returning according to those knowledgeable,” Bloomberg said at the time.
OPEC+ stands for Petroleum Exporting Countries Surplus Organization. Investopedia describes the group as “a loosely connected organization made up of 13 OPEC members and the top 10 non-OPEC oil exporters in the world.” OPEC+ aims to regulate the oil supply to set the price in the global market.
The Indian government is one of the few countries that continues to import oil from Russia after a wave of financial sanctions that hit Moscow’s economy in late February and severely disrupted Russia’s business activities. The US government is spearheading the ongoing sanctions campaign against Russia in an effort to punish the country for its latest war with Ukraine, which began on February 24.
Reuters reported on May 25 that oil exports from Russia have yet to fall despite Western sanctions against Moscow. However, some international traders have refrained from purchasing Russian oil since the end of February due to the collateral impact of the sanctions, which included disruptions to payment systems and delivery methods.
“Russia is not allowed to flow oil to India, but international restrictions in areas such as marine insurance and US pressure on New Delhi make trade difficult. So far, Prime Minister Narendra Modi has resisted Western persuasions to cut ties with Moscow over the possibility of buying oil at a substantial discount,” Bloomberg said on May 4.
Source: Breitbart
