look news india
New US sanctions on Russia could reduce Russian oil sales to India, the largest buyer of seaborne Russian crude. This could make it difficult for Indian state refiners to maintain annual supply contracts, according to three industry sources. The situation is expected to be complicated by sanctions imposed by the US on Friday in response to the second anniversary of Russia's invasion of Ukraine and the death of opposition leader Alexei Navalny.
Russia's Sovcomflot and its 14 crude oil tankers were targeted
The sanctions target Russia's main tanker group, Sovcomflot, and 14 of its crude oil tankers. He is accused of violating the G7 price limit. Indian refiners are worried the sanctions will make it harder to get ships for Russian oil, potentially driving up freight rates. This could mean lower discounts on oil purchased from traders and Russian companies.
India will buy much less Russian oil than before due to higher shipping costs. However, since Europe has stopped importing from Russia, Indian refiners, as one of the world's largest oil importers, are now taking advantage of low Russian prices to buy more oil.
Russia becomes India's largest oil supplier in 2023. India is set to import about 1.66 million barrels of Russian oil per day through term deals and spot market purchases in 2022, compared to an average of 652,000 barrels per day. Indian Oil Corporation, Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) have signed contracts with Russian major Rosneft to produce 400,000 barrels of Russian oil, mainly Urals, annually for the financial year starting April 1. Have signed. Are in talks for.
This deal will depend on payment terms and discounts
The amount of oil in the planned term deal depends on how Russia offers payment terms and discounts, the sources said. Rosneft has offered a discount of $3-$3.50 a barrel to the Dubai price, more than Indian Oil's current deal, which expires on March 31, which offers a discount of $8-$9 a barrel.