Russia to offer India, cheaper crude oil at pre-war pricesÂ

India is the second-largest oil importer in Asia after China and a good customer of Russia. India has always imported oil from Russia, however, recently Russia has offered the oil at far cheaper prices.

According to the experts, due to the attack on Ukraine, Russia faces strong international pressure, and now it wants to clear its stocks.

The sanctions-hit country is selling its flagship Urals grade to India at discounts of up to $35 a barrel on pre-war pricing to entice India to lift more shipments, according to private sources.

Also read about the GDP comparison of Russia with other countries.

It is to be noted, that Brent Oil prices have grown by around $10 since then, signifying an even greater discount from present levels.

Russia has certain types of oil deposits, like Urals oil is a reference oil brand that is used to determine the price of Russia's export oil combination. It combines heavy sour oil from the Urals and the Volga area, with light oil from Western Siberia. Brent, West Texas Intermediate, and Dubai are three other reference oils. Russia wants India to take the first 15 million barrels committed for this year, they claimed, adding that conversations are going place at the government level.

For the reader's information, An oil barrel is defined in the oil industry as 42 US gallons, which is approximately 159 liters or 35 imperial gallons.

The average monthly price of Urals crude oil, Russia's main export oil brand, was around 95.2 US dollars per barrel in February 2022, an increase from the previous month and now Russia has lowered the price to a great extent. After the United States and China, India is the world's third-largest consumer of oil, with more than 80% imported. In 2021, India purchased approximately 12 million barrels of oil from Russia, accounting for only 2% of total imports. 

Historically, India has purchased less oil from Russia, owing to high transit expenses. However, with substantial savings presently available, it makes sense to purchase Russian oil. As pressure rises on India to reject cheaper Russian oil, New Delhi has vehemently maintained its right to seek "fair deals" to satisfy its energy needs. At the same time, it has highlighted Europe's expanding purchases of Russian petroleum products despite the Ukraine conflict.

Finance Minister Nirmala Sitharaman stated on Friday in a clear statement that New Delhi remained unwavering in its commitment to forge its own path: "We have begun buying" (from Russia). This will continue, and India's overall interests will be considered." She stated that India has purchased goods to satisfy the requirement of 3-4 days. Imports supply around 85 percent of New Delhi's crude oil requirements.


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