Export of Russian oil to India has been growing for 10 consecutive months. According to statistics collected by the Kpler agency, in May 2023, Indian refineries were importing 1.96 million barrels of Urals crude oil per day (46% of all Indian oil imports), rising to 2.2 million barrels in June. Due to Western sanctions, Russia has been forced to send 20% of its crude oil previously sold in Europe to Asian markets. Russia has taken the lead in oil trade with India, overtaking Saudi Arabia (745,000 barrels per day) and Iraq (835,000 barrels per day).
Over the past two months, the largest importer of Siberian oil to India has been the state-owned Indian Oil Corp., followed by Reliance Industries Ltd. In 2022, Russia and India reached an agreement under which a significant part of bilateral trade would be paid in rupees and rubles. Russian exporters quickly accumulated significant amounts of Indian currency in Indian banks. According to Bloomberg. until May last year, availability was growing at a rate equivalent to $1 billion per month. But soon it was discovered that Indian law prevents the conversion of rupees into hard currency, as well as the export of this money. Since May 4, Moscow and New Delhi have suspended the transition to commercial settlements in national currencies.
An interim solution was found in June when Indian Oil Corp. became the first oil importer that paid for a part of Russian crude oil in Chinese yuan. According to undisclosed Reuters’s sources, “it is also reported that two other major Indian refineries will be paying for Russian oil in Chinese currency.” Some claim it could have been Reliance Industries Ltd. and HPCL Mittal Energy Ltd.