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The world’s third-largest oil importer, India, is negotiating steep reductions for the Russian oil it’s ready to purchase, asking for beneath $70 per barrel worth to compensate for logistics, financing, and sanctions troubles for getting crude that’s now poisonous for many of the West, Bloomberg reported on Wednesday, quoting sources aware of the talks.
Because the starting of the Russian battle in Ukraine, India – a price-sensitive crude purchaser which has criticized OPEC and OPEC+ for maintaining oil costs “artificially excessive” – has elevated its purchases of Russian crude. Earlier than the battle, Indian refiners not often purchased oil from Russia at such a scale due to excessive freight prices.
Now India – alongside China – is left as one of many few patrons prepared to take care of Russian oil, and is utilizing that leverage in high-level talks with Russia. India desires Russia to low cost its oil to beneath $70 a barrel on a delivered foundation, in accordance with Bloomberg’s sources.
If India and Russia agree on such a hefty low cost – with Brent over $108 a barrel early on Wednesday – state-owned refiners in India might import as a lot as 15 million barrels of Russian oil in Could, Bloomberg’s sources say. This may be equal to round 10% of all of India’s oil imports.
Whereas China and India will not be shying away from Russian crude, the logistics of transport oil from Russia’s Black Sea and Baltic ports to Asia and the scarce tanker availability, financial institution ensures, and insurance coverage for Russian cargoes would restrict the quantity of oil that Asia might take and compensate for misplaced barrels which might be now not going to Europe, analysts say.
Low-cost Russian barrels at the moment seem irresistible to Indian refiners, regardless of warnings from the US that purchasing Putin’s oil will not be in New Delhi’s greatest curiosity.
India has abstained from becoming a member of virtually all nations on this planet in condemning Russia’s invasion of Ukraine in UN resolutions, and has protection and navy ties with Moscow.
By Tsvetana Paraskova for Oilprice.com
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