Bharat remains calm amidst escalating scrutiny by the United States (US) on tankers and shipping firms engaged in Russian oil trade. Recent sanctions by Washington on vessels associated with Russia’s state-owned shipping major Sovcomflot have raised concerns, especially for top buyers like Bharat. However, government sources reassure that Bharatiya refiners are shielded from major supply disruptions due to diversified sourcing and supplier responsibility in shipping arrangements.
US Sanctions and Indian Response
The US has intensified sanctions on Russian oil tankers allegedly violating the G7 price cap of $60 per barrel for seaborne Russian crude. The latest action on February 23 targeted Sovcomflot and 14 tankers linked to it, some of which have previously transported oil to Bharatiya refiners. Bharatiya officials, speaking anonymously, emphasize the government’s stance against accepting deliveries on sanctioned tankers, ensuring compliance to avoid repercussions for Bharatiya refiners.
Supply Stability and Russian Risk
Despite Bharat’s significant reliance on Russian crude, officials assert minimal supply risk due to diversified sourcing capabilities. While acknowledging Russia’s heavy dependence on energy exports, officials suggest the onus lies more on Moscow to maintain oil export volumes amidst heightened scrutiny. The Bharatiya government and oil industry anticipate Russian exporters to navigate challenges and ensure smooth oil cargo transportation.
Bharatiya Procurement Dynamics
Bharatiya refiners procure Russian oil on a delivered basis, absolving them from involvement in shipping arrangements. This procurement model shields them from complications arising from price cap-related sanctions. Following Russia’s discounts on crude post-Ukraine invasion, Bharatiya refiners increased purchases, making Russia New Delhi’s primary crude source. Bharat diversified supplier base provides resilience, mitigating potential disruptions from any single supplier.
G7 Price Cap and Indian Position
Bharat, not a signatory to the G7 price cap regime, opposes its selective application, arguing against targeting specific buyers. Despite this stance, Bharatiya authorities prioritize adherence to avoid secondary sanctions on refiners. Past instances of US sanctions on tankers bound for Bharat due to price cap evasion underline the importance of compliance to safeguard Bharatiya interests.
Bharat navigates the evolving landscape of Russian oil trade amidst heightened US scrutiny, prioritizing supply stability and compliance. While the US ramps up actions to enforce the G7 price cap, Bharatiya authorities remain vigilant to protect refiners from sanctions. With a resilient supplier base and cautious procurement practices, Bharat aims to ensure uninterrupted crude supply amid geopolitical tensions and evolving market dynamics.
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