India Prioritizes National Interest in Oil Procurement: Government
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Synopsis
The Indian government emphasizes that its decisions regarding international oil purchases are shaped by national interests and priorities. Despite US sanctions, India continues to import Russian oil, while diversifying its sources to ensure energy security.
Key Takeaways
- India's oil procurement is driven by national interests.
- US sanctions affect Russian oil imports.
- India is the third-largest oil consumer globally.
- Challenges in securing shipping and insurance for Russian oil.
- Diversification of oil sources is a key strategy.
New Delhi, March 20 (NationPress) The Indian government's approach to international oil procurement is influenced by various factors, prioritizing the nation's interests and objectives, as stated in the Rajya Sabha on Thursday.
Responding to a query on whether the USA had requested India to cease unloading Russian oil shipments and imposed a deadline, Minister of State Kirti Vardhan Singh indicated that on January 14, the US Embassy in New Delhi provided the Ministry of External Affairs with information regarding U.S. sanctions effective from January 10, 2025.
These sanctions were enacted by the US Department of Treasury's Office of Foreign Assets Control (OFAC) against more than 400 entities linked to the Russian energy sector, including major oil companies, their subsidiaries, LNG terminals, insurance firms, oil traders, brokers, and oil vessels.
A 60-day winding down period was also established, after which the US will identify any entities that continue to engage with sanctioned parties in Russia’s energy sector, as noted by the Minister in a written response.
The Minister assured that all necessary actions have been taken to inform relevant stakeholders about any provisions that might affect Indian oil traders, oil field service providers, and insurance companies.
Despite US sanctions, India has been acquiring significant amounts of oil from Russia due to the favorable prices, which has also contributed to stabilizing international oil prices, as India stands as the third-largest oil consumer globally.
Nevertheless, with the US administration implementing stricter measures, it is becoming increasingly challenging to secure ships and insurance for transporting Russian oil.
Simultaneously, India has broadened its oil procurement sources, and increased production from the US is anticipated to help maintain price stability. India is likely to enhance its oil imports from the US as part of its diversified strategy to meet its energy requirements.
Market analysts are also monitoring US efforts to mediate an end to the Ukraine-Russia conflict, with ongoing negotiations for a peace agreement.
