India Increasingly Turning to Discounted Russian Oil, Saving $5 Billion: Bank of Baroda

India’s imports of Russian oil to India increased tenfold last year, according to Indian state lender Bank of Baroda. Figures show that Asia’s third-largest economy has saved about $5 billion by boosting its purchases of crude oil from Russia, the BBC reported today, May 11.

Russia is selling a strategic energy carrier at a deep discount to world economy leaders such as China and India, two of the world’s largest oil importers.

In 2021, Russian black gold accounted for only 2% of annual crude oil imports to India. According to the Bank of Baroda, this figure is currently almost 20%.

The figures show that India’s purchases from Russia during the last fiscal year saved it about $89 per tonne of crude oil.

Despite pressure from the US and Europe, the South Asian giant has refused to comply with Western sanctions on Russian oil imports. India defends its oil purchases by saying that, as a country heavily dependent on energy imports, it is unable to pay higher prices.

“Since the start of the conflict in Ukraine, Europe has imported six times more energy from Russia than India,” the country’s foreign minister said in a TV interview last year. Subramanyam Jaishankar. “Europe has been able to cut its imports in a way that suits itself.”

“If it’s a matter of principle, why didn’t Europe cut imports on the very first day (of the imposition of anti-Russian sanctions. — Ord.)?» the head of Indian diplomacy then asked rhetorically.

With no end in sight to the conflict in Ukraine, some analysts expect Russia to continue offering cheap oil to Asia’s biggest energy importers, the BBC said.

“We expect that growth in Russian oil consumption will continue to be limited to these two countries (India and China), which will allow them to maintain significant discounts,” – said in an interview with the British news service Vandana Hari from the analytical company Vanda Insights.

According to her, Indian refineries will continue to maximize their profits for as long as possible.

As reported EADaily, revenues of European diesel producers are declining. In Europe, local refineries have to compete with oil products from India and China, which are made from cheaper Russian raw materials.