Is India’s growing reliance on Russian supplies a long-term risk?
Helsinki, Finland-based Centre for Research on Energy and Clean Air or CREA, came out with a report earlier this month stating that five countries, including India, were “laundromats” for Russian oil. Why did it say so?
CREA claims that 5 countries – India, China, Turkey, the UAE and Singapore – were ‘laundering’ Russian crude and calls them ‘laundromats’ for being conduits for oil from Russia to eventually reach the G7 and other European nations.
Countries that have imposed sanctions on purchases of Russian crude oil at prices greater than $60 per barrel include the G7, European Union, Australia and Japan. The sanctions include unavailability of insurance for crude in transit, and of tankers from countries that imposed these sanctions. These countries are referred to as the price-cap coalition countries.
In its report, CREA also named a couple of ports in India that contributed the largest quantum of import of Russian crude as well as of the export of refined petro products to Europe – the Sikka and Vadinar ports.
Sikka services Reliance Industries’ Jamnagar refinery. It not only imports the highest quantum of seaborne Russian – or Urals crude – but also exports the maximum refined petroleum products to Europe.
In a report summary, CREA said that €2.7 bln of petroleum products have been exported from Sikka to price-cap coalition countries from December 2022 to February 2023.
The Vadinar port is also in CREA’s crosshairs as Russian oil giant Rosneft is a joint venture partner in Nayara’s Vadinar refinery. CREA claims that this port is of great value to Rosneft as a Russian JV in a third-party country offers a possible way to circumvent the sanctions.
How did India’s MEA respond? From India’s point of view, is its increasing reliance on Russian supplies a risk in the long-term?
Script and presentation: K. Bharat Kumar
Production: Shibu Narayan
Videography: Johan Sathyadas
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