India sees no disruption in Russian crude oil supplies for next 2 months

NEW DELHI: India expects no immediate disruption to its Russian oil imports following recent US sanctions, a senior government source said Monday. The official, who requested anonymity, confirmed that Russian oil shipments booked before January 10 will be permitted to discharge at Indian ports through March.

The source said there is a wind-down period until March 12, which will allow for existing contracts to finish.

The US Treasury’s latest sanctions, announced Friday, target Russian oil producers Gazprom Neft and Surgutneftegaz, along with 183 vessels involved in Russian oil transportation. These measures aim to reduce Moscow’s war funding capabilities in Ukraine.

“The market is waiting for Russia to respond on sanctions,” the official stated. “Russia will find ways to reach us.” He suggested that Russia might offer steeper discounts to maintain exports to India while complying with the $60 per barrel price cap implemented by G7 nations in 2022.

The news sparked market reaction, with Brent crude futures climbing above $81 per barrel on Monday, reaching levels not seen since August. However, the official dismissed the price surge as temporary, predicting Brent would settle below $80 due to adequate global supply.

India became the second biggest buyer of Russian crude oil since Moscow invaded Ukraine in February 2022, with purchases rising from less than 1 per cent of the total oil imported to almost 40 per cent of the country’s total oil purchases.

India, as the world’s third-largest oil importer and consumer, maintains a pragmatic approach to securing its energy needs despite international tensions.with agency inputs