The fierce war between Russia and Ukraine is going on for past 18 days. While, on the one hand, Russian attacks have devastated various cities in Ukraine, on the other hand, the condition of Russia is also getting battered by sanctions applied on it from other countries including America. Meanwhile, now there is relief news for Russia from India. In fact, a report quoted sources as saying that India is now considering buying subsidized Russian oil and other items amid the on going war that will benefit both Russia and India.
Russia’s barrage of sanctions
According to the report came to the fore, there is a possibility that India can consider the proposal given by Russia for buying oil. Under this, crude oil along with other commodities can be purchased at concessional rates by India from Russia. Significantly, amid the tight Western sanctions on Russia over its inhumane invasion into Ukraine, two officials said that India is looking at taking up a Russian offer for purchases through rupee-ruble transactions. Let us tell you here that after Russia’s attack on Ukraine, various economic sanctions have been imposed on Russia. America and European countries have applied many sanctions on Russia ranging from oil imports to other commodities. Which is now becoming a big problem for the Russian economy.
Russia gave this offer to India
Significantly, in view of Russia’s attack on Ukraine, amidst the sanctions imposed on Russia by the US and other European countries, a report said that Russian oil companies will give 25 to 27 percent discount on the price of crude oil to India. India buys a large quantity of crude oil from Russia’s company Rosneft. In December 2021, during Vladimir Putin’s visit to India by Russian President, a contract was signed between Rosneft (Russia’s Company) and India Oil Corporation to supply 20 million tonnes of crude oil to India through Novorossiysk port by the end of 2022.
Russia second largest oil producer
Significantly, since Putin’s declaration of war, the fear of disruption in energy exports had increased, which is now clearly visible in India. Let us tell you that Russia is the second largest oil producer in the world, which mainly sells crude oil to European countries. The countries of Europe take more than 20 percent of their oil from Russia itself. In addition to this Russia produces 10 percent of the world’s copper and 10 percent of aluminum in global production. According to a report, Russia is the world’s top exporter of crude and oil products, by shipping about seven million barrels per day, or seven percent of the global supply.
85% crude oil imports
Significantly, India is a major importer of crude oil and it buys more than 85 percent of its crude oil from foreign countries. India has to pay the cost of imported crude oil in US dollars. Due to the increase in the price of crude oil and meanwhile the strengthening of the dollar in world’s economy the prices of petrol and diesel are affected at the domestic level of India too, that is, the fuel have started becoming expensive. If the price of crude oil increases in the international market, then obviously India’s import bill will also increase leading to Inflation in India. A report has also expressed worry that India’s import bill may cross $ 600 billion.