EU Urges Action Against Indian Imports of Russian Oil Amid Ukraine Conflict
Josep Borrell, the European Union's foreign policy chief, has expressed concern about the importation of Indian petroleum products derived from Russian oil.
This represents a rare instance of direct criticism aimed at India for its involvement in helping Russia circumvent Western sanctions during the Ukrainian conflict.
During an interview with the Financial Times, Borrell acknowledged that the EU does not object to increased oil trade between Russia and India. However, he called for measures to address India’s resale of Russian oil into Europe as refined fuel, including diesel.
India has become a prominent purchaser of Russian oil since Moscow’s full-scale invasion of Ukraine on February 24, 2022. Multiple reports, including those from Reuters and Bloomberg, have highlighted growing evidence of Indian companies purchasing Russian oil, refining it, and subsequently selling it to Europe.
The availability of affordable Russian crude has led to higher output and profits for Indian refineries, enabling them to competitively export refined products to Europe.
Borrell emphasized that it is normal for India to purchase Russian oil and even suggested that if India can obtain it at a lower cost due to EU limitations on oil prices, it benefits Russia to receive less money. However, he expressed concerns when India serves as a hub for refining Russian oil and selling the by-products to Europe.
He plans to address this issue with India’s foreign minister, Subrahmanyam Jaishankar, during their meeting.
Imposing significant restrictions on the sale of refined petroleum, India’s primary export would have a detrimental impact on the country’s economy. Such measures could also exert pressure on India to reevaluate its longstanding alliance with Russia, which has strengthened economically since the outset of the Ukrainian conflict.
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Indian refiners, who previously purchased minimal quantities of Russian oil due to high transportation costs, imported approximately 970,000-981,000 barrels per day (bpd) of Russian oil in the fiscal year 2022/23. This accounted for over a fifth of India’s total fuel imports.
Additionally, Rosneft, Russia’s largest oil producer, and Indian Oil Corporation, a leading Indian refiner, have signed an agreement to significantly increase and diversify the oil grades supplied to India.
According to ship-tracking data from Kpler, Reliance Industries, and Nayara Energy are the primary Indian exporters of refined fuels and purchasers of Russian oil. Before Russia invaded Ukraine, India typically exported an average of 154,000 bpd of diesel and jet fuel to Europe. However, this figure has risen to 200,000 bpd following the EU’s complete ban on imports of Russian oil products from February 5 of this year, according to Kpler’s data.
Borrell informed the Financial Times that national authorities would need to implement any measures to halt the flow of Russian oil. This suggests that the EU could target buyers of Indian refined fuels that are believed to be derived from Russian crude.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
