The discount of oil being received from Russia has reduced a lot.

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New Delhi: Crude oil coming from Russia is no longer cheap. After the Ukraine war, the exemption or concession that India was getting on the purchase of crude oil from Russia has now reduced considerably. At one time this discount was 25 to 30 dollars but now it is only 4 dollars. In this way it has declined by 87 percent. Russia’s share in India’s total oil imports has reached 40 percent, which was just one percent before the Ukraine war. When Western countries imposed sanctions on Russia, it started selling oil cheaply. Indian refiners seized this opportunity. But now this discount has shrunk to $4. Also, Russia is charging $11 to $19 per barrel for transportation of oil. This is twice the normal charge for delivery from the Baltic and Black Seas to the west coast. Due to this, the possibility of reduction in the price of petrol and diesel in the country has also diminished.

There has been no change in the price of petrol and diesel in the country for more than a year. Given the availability of cheap oil from Russia, increasing margins of companies and the election season, it was expected that the price of petrol and diesel may fall in the next few days. But Russia has dashed these hopes. According to sources, the cost of transportation from Russian ports to India is sitting at $11-19 per barrel. This is much higher than the transport charges from the Persian Gulf to Rotterdam. Russian oil was banned by European buyers and some countries in Asia like Japan after Russia’s invasion of Ukraine in February last year. Due to this, Russia started selling oil with a discount. The discount on Russian crude oil, which was $30 a barrel in the middle of last year, has now come down to $4 a barrel.

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2 million barrels of oil per day

Indian refinery companies convert crude oil into fuels like petrol and diesel. Currently these companies are the biggest buyers of Russian oil. India has left China behind in this matter. China’s crude oil imports from Russia have come down significantly due to a slowing economy and large-scale electrification of vehicles. Indian refinery companies have increased their purchases very fast to establish their foothold on the cheap crude oil of Russia. Before the Ukraine war, Russia’s share in India’s total crude oil purchase was only 2 per cent, which has increased to 44 per cent today. But now the discount or concession on Russian crude oil has come down significantly.

This is because public sector Indian Oil Corporation (IOC), Hindustan Petroleum Corporation Ltd., Bharat Petroleum Corporation Ltd., Mangalore Refinery and Petrochemicals Ltd. and HPCL-Mittal Energy Ltd. along with private refinery companies such as Reliance Industries Ltd. and Nayara Energy Ltd. are in separate talks with the U.S. for crude oil deals. Sources said the discount could have been higher had the public sector units negotiated it together. At present, 20 lakh barrels of crude oil is coming from Russia every day. In this, the share of public sector units is about 60 percent.

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What option does India have

India used to buy 44,500 barrels of crude oil per day from Russia in the 12-month period ending February 2022, before Russia’s attack on Ukraine. During the last few months, India’s purchase of Russian crude via sea has crossed that of China. According to sources, Indian refinery companies buy crude oil from Russia on the basis of its supply. Due to this, Russia has to arrange for the transportation and insurance of oil. Although crude oil is being received from Russia at a price of less than $ 60 per barrel, but overall this amount is sitting at $ 70 to $ 75 per barrel.

Brent crude was trading at $ 78.24 per barrel with a slight decline in early trade on Monday. A source said that if oil prices fall further, the $4 discount for Indian buyers will also disappear. Experts say that India can protect its interests only through negotiation. A source said that China has bought oil from Russia in huge quantities and now it is not in a position to take more oil from it. In such a situation, India has remained the biggest buyer with Russia. Consumption in the country is growing at the rate of five to six per cent annually.

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Know the price of petrol and diesel like this

Petrol price in Delhi on Monday is Rs 96.72 and diesel is Rs 89.62 per litre. There is a system to change the prices of Petrol-Diesel daily. If there is a change in this, the prices are automatically updated at 6 am. You can also know today’s rate of petrol-diesel through SMS (How to check diesel petrol price daily). Customers of Indian Oil can get information by texting the code RSP space petrol pump to 9224992249 and customers of BPCL by texting RSP to 9223112222. Whereas, HPCL customers can know the price by sending HPPrice to 9222201122.

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