India's oil imports may be affected after America imposes sanctions on Russian oil companies. Experts believe that India will continue purchasing Russian oil…read more
Trump's strictness on Russian oil, but will India's purchases really reduce (file photo)
Digital Desk, New Delhi. The Trump government of America has imposed strict sanctions on two big Russian oil companies, Rosneft and Lukoil. After this, it is believed that India's purchase of crude oil from Russia may reduce. But experts say this change will not be permanent. India will continue to buy Russian oil, only through changed routes, i.e. through non-sanctioned companies and less transparent channels.
India has increased oil purchases from Russia in November to get more goods before the new US sanctions came into effect on November 21. This is why Russian oil imports reached a five-month high in November.
The US has imposed tariffs of up to 50% on India, of which an additional 25% is punitive duty just because India is buying oil from Russia. The Trump administration alleges that India is helping Russia in the Ukraine war by buying Russian oil.
India has clearly said that it will decide on purchasing energy only after considering its economic interests. In India's view, cheap oil from Russia is beneficial for it. But in October, America has created a new challenge for India by imposing sanctions on Rosneft and Lukoil.
As a result, Reliance, HPCL, HMEL and MRPL have stopped purchasing Russian oil for some time. Only Nayara Energy (in which Rosneft has a stake) is still taking Russian oil.
India was getting an average of 1.8 million barrels of oil per day from Russia, which is more than 35% of the total imports. This quantity increased further to 1.9-2.0 mbpd before November 21, as companies were ordering more goods before the restrictions came into effect.
According to Kpler, imports may decline to about 1.0 mbpd in December, but this decline will be temporary. New methods are also being adopted by Russia, such as:-
Experts say that India will not stop taking Russian oil for a long time, because politically India does not want to be seen bowing to American pressure and Russian oil is still the cheapest option, transactions can continue through non-sanction Russian companies and third-party traders.
Kpler says new vendors are emerging rapidly, such as Tatneft, RusExport, MorExport and Alghaf Marine DMCC. Through these, Indian companies can buy oil by avoiding sanctions.
India bought 568 kbd (thousand barrels/day) of US oil in October, the highest since 2022. It dropped to 450 kbd in November, but is still well above the year's average of 300 kbd. This increase was not due to sanctions, but American oil was economically beneficial and China's demand was low.
Brent-WTI price gap was in favor of India
Purchases from America are expected to decline again to 300-350 kbd in December. It is difficult to increase purchases from the US sustainably because travel times are long, freight is high and WTI oil is relatively light and naphtha-rich.
Indian refineries can technically process any grade of crude. Therefore, the problem is not of operation but of the price of oil. If Russian oil decreases, economic pressure will increase. To meet this shortfall, India will slightly increase purchases from the Middle East (Saudi, Iraq, UAE, Kuwait), Latin America (Brazil, Argentina, Colombia, Guyana), West Africa, America and Canada.
Imran Khan is in a worse condition in jail... Former Pak PM's sister targets Munir; Many secrets revealed after meeting
Reliance, BPCL's oil ships turned towards America, yet how did India become the second largest buyer of Russian oil?
'Be prepared to pay heavy tariffs...', Trump again warns India regarding Russian oil
If Russian oil is stopped... will India really give up Russian oil on Trump's request?
Trump again made absurd comment, said- India will soon stop buying oil from Russia; The claim was already rejected