Individuals familiar with the situation stated on Friday that India appreciates competitive proposals from all energy providers, including Russia, despite geopolitical changes that are posing serious hurdles to the nation's energy security.
The rise in worldwide fuel costs since the start of the Ukraine conflict has exacerbated India's problems, and the stress for competitive sourcing has instinctually enhanced, according to the people, who spoke on the condition of anonymity to clarify the administration's decision to use cheaper fuel from Russia.
Since the United States and its allies slapped restrictions on Moscow in response to President Vladimir Putin's move to attack Ukraine the previous month, Russia has provided India with cheaper crude oil and other goods. Because of the issues connected with the wide-ranging restrictions, European corporations are presently avoiding purchasing Russian oil.
Russian oil supplies to India, the globe's third-biggest energy consumer, surged in March, as per the Financial Times. In March alone, Russia sold 360,000 barrels of oil per day to India, roughly four times the normal for 2021. According to the article, depending on current export plans, Russia is on pace to produce 203,000 barrels per day for the entire month, according to Kpler, a commodities analytics and data organisation.
Geopolitical events, according to one participant, have caused considerable obstacles to energy security. They've had to cease getting oil from Venezuela and Iran for obvious reasons, alluding to India's determination to halt oil imports from Venezuela and Iran, two of the least expensive energy sources for New Delhi, due to United States restrictions.
According to the individual, India must continue to focus on cost-effective energy sources. All manufacturers are invited to make such bids. Indian merchants also scour the world's energy markets for the best deals.
India's lawful energy deals, the individual said, must not be politicised.
Renewable energy has typically come at a greater price, and the price spike following the Ukraine crisis has compounded India's problems. The pressure for competitive sourcing, according to the individual, has inevitably intensified.
India is heavily reliant on imports for its energy needs, with about 85 per cent of the nation's crude oil consumption – or five million barrels per day – coming from abroad. The majority of these imports come from West Asia, with Iraq contributing 23 per cent, Saudi Arabia for 18 per cent, as well as the United Arab Emirates for 11 per cent.
According to the sources, Russia has only been a minor crude oil exporter to India, contributing to less than 1 per cent of the nation's needs and not ranking among the top ten sources. The citizens also pointed out that there is no administration-to-administration agreement regarding energy imports.
Individuals highlighted that Russian oil and gas is purchased by nations all over the globe, notably those in Europe, at a moment when the United States (US), as well as its Western partners, have increased stress on India to take a firmer role on the Ukraine issue.
OECD members Italy, Germany, and France account for over 75 per cent of Russia's overall natural gas exports. Other European nations that acquire Russian crude include Poland, Netherlands, Finland, Romania, and Lithuania.