Bangalore Wealth Management：Two years after buying Russia's discount crude oil, India is going to stop？

In January this year, the number of crude oil imported from Russia has dropped from Russia to the lowest level in the past year.

India's attitude towards Russian crude oil is changing.Bangalore Wealth Management

In January 2024, India's number of imported crude oil from Russia fell to the lowest level in a year, a decrease of 35%compared with the peak period in 2023.India has always been more sensitive to prices, and Hardeep Singh Puri, Minister of Petroleum and Natural Gas, said: "We must supply energy at the lowest price (to the country)."

In addition to price factors, India and Russia have also argued in paying currency. India hopes to pay with India's rupee. Russia believes that it is very useful to collect a large number of rupees. It is hoped that payments such as renminbi have been confused by India.

Liu Zongyi, Secretary -General of the India and South Asian Research Center of Mumbai International Institute, told the First Financial Reporter that buying crude oil from Russia is in line with India's "multi -party balance" strategy. Although India is indeed deepening relationships with the United States, economic cooperation with Russia is, And also help India to achieve economic autonomy.

India strong debate

In February 2022, after the outbreak of the Russian -Ukraine conflict, Western countries imposed a series of sanctions on Russia, including oil embargo, which made India discover "opportunities".The domestic market has saved a large amount of energy expenditure, and India also refined Russian crude oil before exporting to the European market.

India has been criticized by Western countries, but on the international stage, India has always argued for himself.On February 17, Indian Foreign Minister Su Jiesheng held a group discussion with US Secretary of State Brosky during the Munich Safety Conference to defend India's policy again.

When asked about the problem of buying Russian crude oil in India, Su Jiesheng said, "Why is this a problemAhmedabad Wealth Management?" He further stated, "I am smart enough, so there are many choices. You should admire me instead of criticizing me.Is it a question for others? I don't think so. "

Su Jiesheng often defended India's position with a "offensive" situation.In mid -November last year, Su Jiesheng said at an event in the UK that the international community should thank India for buying Russian crude oil because this played an important role in stabilizing the global oil and natural gas market.Hyderabad Wealth Management

Su Jiesheng explained that if India does not buy crude oil from Russia, global oil prices will be higher, "because we will enter the same market like Europe and find the same suppliers as Europe."Lucknow Investment

In fact, India itself is very sensitive to oil prices, because about 80%of the demand for oil rely on imports, and changes in oil prices will have a significant impact on its domestic market.Folding crude oil from Russia eased the further rise of the Indian consumer price index to a certain extent.

But while justified, India is indeed lowering imports from Russia.According to data from Vortexa, in July 2023, India's crude oil imported from Russia set a record of 1.99 million barrels/day, but the import volume has been decreasing since then.Essence

For a long time, the US dollar has been the most important currency in global crude oil transactions, but after the Russian conflict, Russia was crowded out of the US dollar and euro financial network, which prompted other currencies to play an increasingly important role in Russia's financial system.Chennai Stock

In this context, the Indian central bank established the rupee settlement system in 2022 to pay Russian crude oil.However, due to the huge trade surplus of Russia and India, Russia has accumulated a $ billions of dollars in Indian rupee assets, which makes Russia a headache.

Russian Foreign Minister Lavrov said in May last year that the accumulation of Indian rupees is a "problem" and is currently discussing how to convert these funds into another currency.In this context, Russian sellers have expressed their hope to settle in RMB.

Indian Petroleum is India's largest Russian crude oil buyer. In June last year, it became the first state -owned refinery to pay some transactions with RMB.Use RMB to pay some Russian imported products.This triggered the dissatisfaction of the Indian government and believed that the process of obstructing India's rupee internationalization. The Indian Ministry of Finance banned the state -owned refinery from paying RMB. For private enterprises, Indian government officials saidTrade settlement, the government will not stop, but it is not encouraged.

To this day, the controversy of payment currency between India and Russia continues.At the same time, India also began to promote paid with physical objects.Since January this year, India has been paying part of the import costs of bananas, and it is also considered to pay for physical payment including other fruits.

In addition, with the continuous disruption of the Red Sea trade routes, the transportation routes of refined oil such as diesel in India have been greatly affected, and it has also affected India's willingness to procure Russian crude oil.According to Vortexa data, the first two weeks in February this year, the average daily diesel transport from India to Europe was only 18,000 barrels per day, a significant decrease of more than 90%compared with the average level in January.

Mumbai Investment