Russia is undermining the position of Saudi oil in India amid increased competition
A fierce battle is brewing in India, where Russia has cut oil prices below those of its OPEC+ ally Saudi Arabia, paving the way for Moscow to increase the market share of one of the largest importers of crude oil.
Russian shipments of neti were cheaper than Saudi oil from April to June, and the discount widened to almost $19 a barrel in May, according to Bloomberg calculations based on Indian government data. Russia surpassed the kingdom to become India’s second-largest supplier in June, behind only Iraq.
Russian oil to India is cheaper than Saudi. Source: Bloomberg calculations based on government data.
India and China have become eager to consume Russian oil, as most other buyers have abandoned it after starting with the NWO in Ukraine. The South Asian nation imports 85% of its oil needs, and cheap supplies provide some economic relief as the country faces elevated inflation and a record trade deficit.
The country’s spending on crude oil imports rose to $47.5 billion in the second quarter, after rising global prices coincided with a recovery in fuel demand, government data showed. This compares to $25.1 billion in the same period last year when prices and volumes were lower. Oil has recently fallen on fears of an economic downturn, which has given consumers some respite.
“Indian refiners will try to get their hands on the cheapest oil suitable for their refineries and product configurations,” said Vandana Hari, founder of Vanda Insights in Singapore. “Russian oil still meets these requirements. The Saudis and Iraqis are not completely losing because they are sending more supplies to Europe.”