In the first two weeks of September, Russian oil exports by sea amounted to 3.03 million barrels per day, down about 314,000 barrels per day compared to August. A significant part of this decrease is represented by losses from sales to India. In two weeks, it reduced its purchases of Russian oil by 40% compared to August.
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The main reason is the change in the amount of the discount on Russian Ural oil compared to Brent oil from the North Sea. In July, a barrel of Ural oil cost less than $ 40 (CZK 990), now it’s just $ 20, thanks to the drop in the price of Brent oil.
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Therefore, India shifted its focus from the Russian market to the cheaper Asian market and specifically to Saudi Arabia, which overtook Russia in August and became India’s second largest oil importer after Iraq.
Russia offers oil to Asian countries at a long-term discount of 30%.
Economic
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Furthermore, the decline in demand in India comes at a time when the European Union’s partial embargo on imports of Russian oil and petroleum products is about to take effect, Business Insider recalled.
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Representatives of the 27th EU have already agreed on the embargo in June. But the ban contains exceptions for some countries that are heavily dependent on Russian oil. For example, the transport of oil through the Družba pipeline, which supplies the Czech Republic, Slovakia and Hungary, is temporarily excluded from the embargo.
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The Kremlin has previously said that countries like India and China could offset the decline in exports to Europe. But analysts generally have a different opinion. S&P Global said that as a result of the European embargo, Russia could be left with up to 2.2 million barrels of oil per day.
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