Russian and New Delhi According to traders and calculations by Reuters, Russia is selling oil to India for close to $80 per barrel, or $20 more than the Western price cap, as tight global oil markets assist Moscow create a strong demand for its shipments.
Russian oil sold to India: Since the middle of July, the price of Russia’s primary export grade Urals has been trading over the $60 per barrel Western price cap due to production cuts by OPEC+ countries including Saudi Arabia and Russia.
Since 2022, India, the third-largest oil importer in the world, has taken the lead in purchasing seaborne Russian oil, mostly Urals, thanks to Western sanctions against Moscow.
According to trader data and Reuters calculations, Free on Board (FOB) estimates for Urals cargoes shipping from Baltic ports in October were close to $80 a barrel on Thursday for Indian consumers.
An official at an Indian refiner, which frequently buys Russian oil, attributed the recent price increase to Russia’s low inventory levels and production reductions.
Cuts have reduced discounts for Urals at Indian ports from $6–$7 per barrel to $4–$5 per barrel compared to dated Brent, according to four trading sources involved in the activities and calculations by Reuters.
Prices for cargoes loading in late October were mention by the dealers.
“Urals prices are rising once more. Alternatives are far more expensive and difficult to find, according to a trader with knowledge of the Russian oil industry.
“Indian Oil Companies Remain Silent Amid Rising Russian Crude Prices”
Indian Oil Corp, Bharat Petroleum Corp, Hindustan Petroleum Corp, Mangalore Refinery and Petrochemicals Ltd, HPCL Mittal Energy Ltd, Reliance Industries Ltd, and Nayara Energy Ltd did not respond to Reuters’ inquiries for comments.
About two-fifths of India’s total refine fuel consumption is account for by diesel, which is normally produce at higher yields from Russian Urals oil. In the meantime, a worldwide shortage of diesel and petrol fueled Russia’s decision to forbid their exports, which increased the appeal of Urals crude.
In the event that crude trades below $60 per barrel, purchasers are still able to employ Western services like shipping and insurance thanks to the Western price ceiling on Russian oil.
“The global oil price rising to close to $100 per barrel has made it more challenging for Russian oil to utilize Western shipping and insurance companies as frequently since the cap was put in place.”
According to preliminary LSEG data, Turkey was the second-largest purchaser of Urals oil cargoes in September, after China and Bulgaria.
According to the Indian source, new markets like Brazil are also buying Russian oil.