Three trade sources familiar with the agreement said the state-run Mangalore Refinery and Petrochemicals Limited (MRPL) purchased one million barrels of Russian Urals oil for loading in May via a tender, a rare purchase spurred by the discount provided due to the Ukraine crisis.
Since Russia’s invasion of Ukraine on February 24, refiners in India, the world’s third largest oil importer and user, have been picking up Russian oil through spot tenders, taking advantage of significant discounts as other customers walk away.
According to one of the sources, the cargo was sold by a European trader. The deal’s agreed-upon price was not immediately revealed.
MRPL did not respond to a request for comment from Reuters.
According to Reuters calculations, India has purchased at least 14 million barrels of Russian oil since February 24, compared to almost 16 million barrels in all of 2021.
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According to Dated Brent, there is a discount on Urals oil as it has reached a post-Soviet era low as buyers steered away from Russian crude. India, unlike a number of Western countries, has not imposed a ban on Russian oil imports.
“We have started buying (Russian oil). We have received… quite a number of barrels, I would think about 3-4 days’ supplies, and this will continue,” Finance Minister Nirmala Sitharaman said last week.
“India’s overall interest is what is kept in mind… ” I would put my country’s national interest first, and I would keep my country’s energy security first,” she added, adding that if oil is available at a discounted price, “why shouldn’t I buy it?”.
The US has stated that it will not establish any “red line” for India in terms of Russian energy imports, but it does not want to see a “rapid acceleration” in purchases.