Ukraine fallout: Russia pips Saudi as India's second largest oil seller
The war in Ukraine hiked global fuel prices and also opened the doors for the export of cheap Russian oil to Indian refineries. So much so that within a few months of the conflict, Russia has become India’s second-biggest supplier of oil. For the month of May, India imported more oil from Russia when compared with Saudi Arabia, which was the second-largest exporter till then. Though Iraq is still the top supplier to India.
As compared to 27,700 barrels per day (bpd) in April, India received about 819,000 bpd Russian oil in May, as per the Oil and Petroleum Ministry data.
India imported 4.98 million bpd oil in May, a record high since 2020, mainly as the economy opens up with COVID subsiding and local demand getting a boost.
India’s oil imports in May were about 6 per cent higher from the previous month and about 19 per cent from a year earlier, the data provided by the ministry showed.
Russia was forced to sell its oil cheap after the West led by the US imposed severe sanctions on Moscow for invading Ukraine. Till then Russia was never the favourite seller for India, which found its oil expensive mainly because of high freight charges. In May, Russia sold about 17% of its oil to India. During this time, the share of oil from Middle East declined while that of African oil nations rose from 5.9 per cent to 11.5% in April. India hiked import of Nigerian oil also because it was cheaper as compared to the Middle Eastern supplies.
India has defended its purchase of “cheap” Russian oil saying imports from Moscow made only a fraction of the country’s overall needs and a sudden stop would drive up costs for its consumers.
Higher oil imports from Russia, curbed OPEC’s share in India’s overall imports to 65 per cent in April.