India rebuts Trump on Russian oil claim, says policy 'driven by national interest'
Government sources on Saturday refuted US President Donald Trump’s latest claim that India “is no longer going to buy” oil from Russia, as Washington steps up pressure over New Delhi’s energy ties with Moscow.
Sources told ANI that Indian oil refiners continue to source oil from Russian suppliers. Their supply decisions are guided by price, grade of crude, inventories, logistics and other economic factors, they added.
Backing their decision to continue sourcing Russian Oil, sources added that India's energy decisions have been guided by national interest but have also contributed positively to global energy stability.
India's pragmatic approach kept oil flowing, prices stable, and markets balanced, while fully respecting international frameworks, they said.
Providing context for India's decision to continue sourcing oil from Russian suppliers, sources said that Russia, the world's second-largest crude oil producer with an output of around 9.5 mb/d (nearly 10% of global demand), is also the second-largest exporter, shipping about 4.5 mb/d of crude and 2.3 mb/d of refined products.
Fears of Russian oil being pushed out of the market and the consequent dislocation of traditional trade flows drove dated Brent crude prices to soar to US $137 per barrel in March 2022, they added.
"In this challenging environment, India, as the world's third-largest energy consumer with 85% crude oil import dependence, strategically adapted its sourcing to secure affordable energy while fully adhering to international norms," sources said.
This comes after Trump on Friday (local time) said he had heard that India is no longer going to buy oil from Russia, which he hailed as a "good step" but added that he wasn't sure about the development.
"Well, I understand India no longer is going to be buying oil from Russia. That's what I heard. I don't know if that's right or not, but that's a good step. We'll see what happens," Trump told reporters.
Trump's comments come a day after the White House announced tariffs the US will impose on exports from about 70 nations. According to the executive order, India will face tariffs of 25 percent, but it did not mention the "penalty" that Trump had said India will have to pay because of its purchases of Russian military equipment and energy.
On Thursday, Reuters had reported, citing its sources, that India's state-owned refineries suspended Russian oil purchases last week amid threats of tariffs and penalties from Trump and narrowing price discounts.
Sources speaking rebutted media reports of India halting purchase of Russian Oil and after US President's latest comment echoing the claim in the media report.
Meanwhile, providing further historical context to its decision of sourcing Russian Oil, sources told ANI that Russian oil has never been sanctioned; instead, it was subjected to a G7/EU price-cap mechanism designed to limit revenue while ensuring global supplies continued to flow.
India acted as a responsible global energy actor, ensuring markets remain liquid and prices stable. India's purchases have remained fully legitimate and within the framework of international norms, they added.
"Had India not absorbed discounted Russian crude combined with OPEC+ production cuts of 5.86 mb/d, global oil prices could have surged well beyond the March 2022 peak of US$137/bbl, intensifying inflationary pressures worldwide," the sources continued.
It is also pertinent to note that Russian oil has never been sanctioned and it is still not sanctioned by either the US or the EU.
Sources said that Indian OMCs have not been buying Iranian or Venezuelan crude which is actually sanctioned by the US. OMCs have always complied with the price cap of $60 for Russian oil recommended by the US. Recently EU has recommended a price cap of $47.6 dollars for Russian crude which will be enforced from September.
Commenting on European Union's import of Russian-origin liquified natural gas (LNG) during this period, sources added, "EU was the largest importer of Russian liquefied natural gas (LNG) during this period, buying 51% of Russia's LNG exports, followed by China at 21% and Japan at 18%. Similarly, for pipeline gas, the EU remained the top buyer with a 37% share, followed by China (30%) and Turkey (27%)."