The recent threat of US President Donald Trump’s imposition of financial sanctions on Russia during the war on Uharinae threw attention to the two largest buyers of Moscow oil – India and China.
Trump announced new weapons for Ukraine and threatened to slap new sanctions against the buyer of Russian exports if Moscow disagrees with a peace agreement in 50 days.
While markets have so far remained skeptical about disruption, the notes indicate the potential disturbance of global oil supply.
India is a severe dependence on Russian oil
India has become the main importer of Russian oil since the invasion of Ukraine at the beginning of 2022, Bloomberg informed.
Before the conflict came from Russia less than 1 % of Indian oil purchases. However, this figure rose sharply to more than a third of its total import, which came from OPEC from producer this year, the data from Kpler shows.
June saw that Russian oil flows to India will reach 2.1 million barrels a day, the largest monthly income in almost a year and a close record in May 2023.
This shift was largely driven by discounted prices offered by Russian manufacturers after Western sanctions, Reuters reported earlier.
How much does China rely on Russian oil?
Chinese imports also significantly climbed for the same period.
While his purchases did not speed up at the same pace as India, China has remained over 1 million barrels a day since the beginning of the war, making Russia the main energy supplier for the Chinese economy.
The market remains skeptical
Despite the strong statements of Trump, the initial reaction from the market was imbalance.
The Brent Global Benchmark dropped by almost 2 percent on Monday to close below $ 70 per barrel, indicating only little concern about the possible impact on raw streams, the press agency reported.
Trump also announced that sanctions would come in the form of “secondary tariffs” without providing details and introduced in 50 days if Russia is not hostility with Ukraine.
Matt Whitaker, US Ambassador in NATO, said the action effectively represents sanctions on nations buying Russian oil. Whitaker specifically quoted India and China.
What are the alternatives for India?
Speaking of the alternative options of India, Mukesh Sahdev, the leading commodity markets in the Rystad Energy and/S, he said: “If pushing actually gets into shoving and India cannot buy any oil from the Russian system, then India has the option with other OPEC members.”
He also warned that in this case “it will be at higher costs.”
Oil barrels from the Middle East and Africa could help bridge the abyss of lost Russian supplies, but India would have to spend more because it is costly.
Imports from Saudi Arabia in May were $ 5 for a barrel higher than from Russia, while consignments from Iraq were about 50 cents according to the official data of the Ministry and Indian Ministry and Industry.
This emphasizes the economic advantage of India is currently gaining from Russian oil.
(Tagstotranslate) Russia oil
