Agencies

July 9: India has been buying large quantities of crude oil from Russian ever since Russia’s invasion of Ukraine in February last year.

The concession on oil given to India by Russia has been reduced significantly at present.

Russia has been selling crude oil to India for less than $60 per barrel. This is lower than the price limit set by Western countries for Russian oil. But when bringing oil from the Baltic to India via the Black Sea, the delivery charge per barrel ranges from $11 to $19. Sources say that this is double the normal rate.

After Russia attacked Ukraine on February 24, 2022, European buyers and some buyers in Asia, including Japan, banned Russian oil. Russia then started selling oil to India and China at a massive discount.

Until the middle of last year, Russia used to give a discount of $30 per barrel to India. But recently it has been reduced to US$ 4 per barrel, according to sources.

Currently, India is the largest buyer of Russian oil. Due to increasing electrification of vehicles and economic slowdown, the demand for Russian crude oil in China has reached its peak and started to decrease. Before the Ukrainian war, the proportion of Russian oil in India's total crude oil imports was less than 2 percent. But recently, the share of Russian oil has increased to 44 percent.

It is also said that the discount is shrinking because Indian oil companies are negotiating separately with Russian companies. Sources say that the discount could have been much higher if the state-owned oil companies had bargained collectively.

India is buying 2 million barrels of oil per day from Russia. Sixty percent of this oil is bought by government oil companies.