Sharp increase: India buys more Russian oil

“Since the start of the latest Russian sanctions, Russia has become India's fourth largest supplier. The Western states tolerate the development, also because India is supposed to keep China in its place.

India's imports from Russia have multiplied since April last year. The 384 percent increase up to January this year is mainly due to the purchase of cheap Russian oil. At the same time, Russia has become India's fourth largest supplier after China, the oil-producing United Arab Emirates and the United States. In the previous year, despite large arms purchases, it only held 18th place.

At that time, India had ordered goods worth almost 10 billion dollars from Moscow. Now it's more than $37 billion. In December alone, Indians were buying 1.2 billion barrels of Russian oil a day; 33 times more than in December 2021.

India is the world's third largest importer of crude oil after China and the United States. Many countries around the world have imposed import bans on Russian oil and a maximum price of $60 a barrel. 

This gives the Indians the opportunity to increase their imports at low prices.

India has "bought, refined and sold a lot of crude oil," said Secretary of Commerce Sunil Barthwal.

As a result, the export value of oil products rose by 55 percent in the first ten months of the Indian financial year (ending March 31) from previously 51 to 79 billion dollars.

The continued purchase of Russian oil should also be an issue behind closed doors during the visit of Chancellor Olaf Scholz to New Delhi from Saturday.

However, high imports are slowing down New Delhi's plan to internationalize the rupee. With the trade surplus skyrocketing from oil sales, Moscow has no interest in raking in billions of rupees.

India's central bank proposed a foreign exchange deal in July to take the pressure off the rupee. It continues to lose value against the dollar. Major buyer Reliance, owned by billionaire Mukesh Ambani, now pays for its Russian oil supplies in dirhams, the UAE's currency, which is tied to the US dollar.

Indian growth depends on oil

The coalition of democratic countries that are sanctioning Moscow condone the Indian approach - they see what will soon be the most populous country on earth as an important strategic partner in keeping China in its place.

India is dependent on oil imports to sustain its growth of around 7 per cent to ensure the stability of society.

Indian Foreign Minister S. Jaishankar, under pressure to justify the oil purchases last year, stressed: “It is a sound policy to go where we can get the best deal in the interest of the Indian people. And that's exactly what we're trying to do.” While India advocates an end to the military operation, it has not directly condemned Russia to this day.

Russia's opponents are now also agreeing to the oil purchases: “It's an advantage for India, it's an advantage for the Indian economy. But it also helps advance our twin goals of stabilizing markets and denying resources to the Kremlin," said Geoffrey Pyatt, Washington's assistant secretary of state for energy, of the price cap exploitation. "Even though India is not a member of the coalition of countries that set the cap, it has used it effectively in its price negotiations."

Analysts suspect that behind the West's strategic thinking is the fear of driving Moscow even further into Beijing's arms. India and China top the list of biggest buyers of cheap oil from Russia.”

 

The prices at which India buys Russian oil are not publicly disclosed. We, the West, continue to buy Russian oil products, only now through the intermediary India. This, and additional transportation costs, cause increased prices and drive us into crisis as central banks try to control those prices. So much for strategic thinking.