Mikhail Zhuravlev, Senior Expert of the Economic Department at the Institute for Energy and Finance, commented to Rossiyskaya Gazeta about the oil discount in India.
India refuses to accept tankers from the sdn list (sanctions list) in its ports, limiting supplies from Russia, Mikhail Zhuravlev explains. He also believes that compliance with US sanctions harms Indian refineries, since Urals is still the most profitable offer on the market, except for limited supplies of Venezuelan oil. In December 2023, the Urals discount to Arab grades was 7-8 dollars per barrel, and to American WTI oil - more than 10 dollars per barrel.
Zhuravlev believes that our oil exports to India will decline. The sdn list includes the entire Sovcomflot company, and not individual tankers, which further complicates logistics. Oil companies will be forced to use the Western tanker fleet and follow the price ceiling, which will reduce the marginality of exports. Among the alternative options, it is possible to expand the shadow fleet and register tankers for new one-time companies and diplomatic negotiations with India, which can make a choice in favor of economics rather than politics. Especially when oil prices rise and make refining in India unprofitable again due to fixing fuel prices in the local market, the expert clarifies.
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