The Indian authorities are ready to support the price ceiling for Russian oil, which was introduced by a coalition of Western countries, if necessary. For example, if the price of Russian oil for India exceeds the current marginal price level, or if Western countries decide to impose secondary sanctions on the purchase of Russian oil. This is reported by Telegraph India, citing sources in the Indian government.
Sources of the publication note that at the moment India is satisfied with everything, the average cost of a barrel of oil from Russia is $53-56. Moreover, if the cost of Russian oil exceeds $60 per barrel, then Indian companies will drastically reduce its purchases from Russia. A similar decision will be made if Western countries impose secondary sanctions on the purchase of Russian oil, sources say.
After the invasion of Ukraine, India became a key buyer of Russian oil, New Delhi took advantage of the situation and significantly increased the supply of fuel bought at huge discounts. Reuters interlocutors even claimed that some shipments were shipped from Russia to India at prices below the cost of production. The volume of Russian oil supplies to India is estimated at 1.17 million barrels per day – a record high figure, especially considering that a year ago India received only 32,000 barrels per day.
After the imposition of Western sanctions on oil from Russia, Moscow was left with only three major markets: India, China and Turkey. Partial deliveries continue to Bulgaria, but their volumes are small. Western sanctions have imposed a ceiling on Russian oil prices of $60 per barrel, buying Russian oil at a price higher than this threatens foreign companies with secondary sanctions, so most organizations that previously provided financial, insurance, logistics or other services now refuse to cooperate with Russian partners in case of violation of the established price ceiling.
The sanctions have already significantly reduced the oil revenues of the Russian budget, the average selling price hovering around $50 per barrel, and oil is sold at $38 per barrel from some ports. Russian President Vladimir Putin threatened to respond to the restrictions with a supply ban to all countries that would join the ceiling, but so far this has not happened – Russia itself sells its oil at a price below the ceiling, because there are too many of it on the market, and there are no buyers. The Energy Ministry previously announced an additional response to Western restrictions, but did not disclose their essence.