India Saves $2.7 Billion Importing Oil From Russia

With Russia having emerged as India's largest supplier of oil, India saved around $2.7 billion by importing discounted Russian oil in the first nine months of this year, as per calculations based on government data.

India is the third-biggest oil importer and consumer in the world. More than 85% of its requirement is dependent on imports, and crude oil makes up about one-third of the country's overall imports by value.

Cheaper Russian oil has allowed India to depend less on imports from the Middle East. Indian government data reportedly shows that India imported 69.06 million metric tons of Russian oil, equivalent to 1.85 million barrels per day, from January to September. This includes transshipments of Russian oil from Spain, Greece and South Korea.

Russia was India's top oil supplier from April to September while Iraq and Saudi Arabia took up the second and third spots, respectively.

Exports from Iraq to India fell by 12% to 928,000 barrels per day during the April-September period, according to reports. As for the world's largest oil exporter, Saudi Arabia, its exports to India fell by about 23% to 607,500 barrels per day during the same period.

In the wake of Russia's brazen invasion of Ukraine in February 2022, Western countries stopped buying oil from Moscow and imposed sanctions. Russia then began offering deep discounts on its crude, which Indian refiners jumped at. This not only made Moscow India's top oil supplier but also allowed the South Asian country to replace Europe as the largest buyer of seaborne Russian crude this year.

Western sanctions and the West's alienation of Russian oil and gas have served up geoeconomic advantages to India. Before the war in Ukraine, Russia was a marginal supplier of crude to India. But today, Russia plays a crucial role in India's energy security.

India-Russia ties have strengthened over the years with cooperation on space, defense, multilateral cooperation and trade. Their energy ties are a cornerstone of their bilateral relationship, especially after Russia's invasion of Ukraine.

The Indian government saved an estimated $3.6 billion with the upswing in Russian oil imports in the last financial year.

"Russia will continue to build up a particularly privileged strategic partnership with the Republic of India with a view to enhance and expand cooperation in all areas on a mutually beneficial basis ... " read the Kremlin's statement titled "The Concept of the Foreign Policy of the Russian Federation" from earlier this year.

S Jaishankar, India's external affairs minister, also said in April that the relationship between India and Russia "has been among the steadiest of the major relationships of the world in the contemporary era."