Russia’s Oil Exports To India Increased Fivefold In July-August

India and China, at least monetarily, are backing Russia’s war efforts.

Compared to the February-March period, in the early days of the war in Ukraine, to July-August, Russia’s oil exports to India have increased by a factor of 5.7, as per a report in Asia Nikkei.

Valued at around $39 million or 40 million euros, the import increase is the largest in the world.

In June, India’s oil imports from Russia peaked at around 933,000 barrels per day (bpd) before slowing down for the next two months.

However, in September, it increased by 18.5 per cent as compared to August at around 879,000 bpd.

Since May, Russia has made up for one-fifth of India’s oil imports, on average, compared to less than 2 per cent in 2021.

China too has not been lagging behind, as their energy imports from Russia increased by 17 per cent, the import increase valued at $29 million.

Oil shipments from Russia to China increased by 16 per cent while coal saw a massive jump of 53 per cent. The increased shipments to Asian superpowers are important for Russia given the rising deficit elsewhere.

Between July and August, compared to February and March, Russia’s natural gas exports via pipeline were down by 56 per cent, export of petroleum products was down by 34 per cent, and coal exports were down by 29 per cent.

India and China, to some extent, have compensated Russia for the decline in fossil fuel exports to the West.

In the United States and the United Kingdom, Russia’s exports were down by 90 per cent and around 70 per cent in Japan.

The total value of the decrease in exports was around 250 million euros. Exports to India and China have covered one-third of these losses.

Other countries are also picking up discounted Russian crude. Energy exports to Turkey, a NATO member, were up by 20 per cent, as the country aims to rein in inflation.

For the same period, United Arab Emirates increased their imports nine times and Egypt by a factor of three, as per the report.

In September, the G7 economies decided to impose a price cap on Russian oil imports. However, the recent OPEC+ cuts, announced last week, may complicate their efforts.

For Russia, the OPEC+ cut presents an opportunity to arrest the dwindling revenues, and the current buyers (mainly India and China) picking up crude at a huge discount.

In the early days of the invasion, India was pressured to denounce Russia and snap all trade and diplomatic ties as the Europeans were promising.

Better sense prevailed, however, with S Jaishankar, quite like his counterpart in the Finance Ministry, reminding the West, time and again, that India would deal with each nation on its terms and not refuse a good deal on oil to manage its economic interests as the threat of a recession looms large.