America has given permission to send oil ships stranded in Russian waters to India. This is only a temporary relaxation of 30 days. Two senior US officials told Reuters that this decision will reduce pressure on the global oil market. Also, India will be able to take a sigh of relief in the oil crisis.
India has 25 days of crude oil stock
India gets a lot of oil from the Middle East. There is only 25 days of crude oil stock in the country and 40 percent of the oil comes through the Strait of Hormuz. If there is any problem here then it can be difficult. That’s why America has given this relief. The US government clearly said, ‘We have issued a temporary exemption of 30 days to continue the sale of oil stranded in Russian waters to India.’
After the start of the Russia-Ukraine war in 2022, India became the largest buyer of Russian oil. But since January the refiners were buying less because America wanted the money not to reach Russia and was putting pressure on it. With this exemption, the threat of 25 percent tariff to India was also averted and an interim trade agreement was also reached with America.
India’s oil refinery reactivated
Now the refinery companies of the state have become active again. Indian Oil Corporation, Bharat Petroleum, Hindustan Petroleum and Mangalore Refinery and Petrochemicals Limited are talking to traders to get Russian oil as soon as possible. According to sources, these companies have already purchased about 20 million barrels of Russian oil.
Companies want to acquire oil molecules
HPCL and MRPL have prepared to take delivery of Russian oil for the first time since November. Traders are now selling Russian Urals crude arriving in March and early April at $4-5 more per barrel than Brent. In February this oil was $13 cheaper than Brent.
A trader said, ‘Now Indian refiners are not just looking at the price, they want the oil molecules. Availability is the biggest problem. Reliance Industries is also contacting traders to get Russian oil soon.
This exemption is only for stranded cargo and it is not yet clear what will happen after 30 days. But at present, Indian refinery companies have got relief and the arrival of Russian oil in the market is expected to increase.
