India defends purchase of discounted Russian oil

Indian government officials yesterday defended the continued buying of Russian oil, saying European countries were still purchasing hydrocarbons from Moscow and that high crude prices left New Delhi with little choice.Indian oil refiners have in recent days reportedly purchased several million barrels of discounted Russian oil even as the West seeks to isolate Moscow economically over its invasion of Ukraine.But an Indian government official said yesterday that the world’s third-biggest consumer of crude relied on imports for almost 85% of its needs, with Russia supplying a “marginal” less than 1% of this.“Geopolitical developments have posed significant challenges to our energy security. For obvious reasons, we have had to stop sourcing from Iran and Venezuela. Alternative sources have often come at a higher cost,” the official said on condition of anonymity.“The jump in oil prices after the Ukraine conflict has now added to our challenges...India has to keep focusing on competitive energy sources,” they said.“Countries with oil self-sufficiency or those importing themselves from Russia cannot credibly advocate restrictive trading,” the official added, referring to the US and European nations respectively.New Delhi, which historically has had close ties with Moscow, has called for an end to the violence in Ukraine but has stopped short of condemning Russia’s invasion, abstaining in three votes at the United Nations.The White House said this week that it did not appear any Indian oil purchase would violate US sanctions.But press secretary Jen Psaki urged foreign nations to “think about where you want to stand when history books are written” on the conflict.New Delhi has been working on a rupee-rouble trade mechanism to facilitate trade with Russia, bypassing the need to denominate trade in US dollars, according to local media reports.In addition to oil, India also imports large volumes of Russian arms — Moscow is its largest supplier — as well as fertilisers and rough diamonds to be cut and polished and then exported elsewhere.Indian exports to Russia include pharmaceuticals, tea and coffee. Oil prices had already risen sharply before the Ukraine conflict, squeezing consumers in India where the average daily wage among rural workers was just Rs175 ($2.30) in 2018, according to UN figures.“We are a relatively poor country and these oil prices matter a lot: electorally, politically, socially and otherwise,” Lydia Powell of the New Delhi-based Observer Research Foundation said.