Russia’s state oil firm Rosneft has agreed to the country’s biggest-ever energy deal with India, Reuters reported Thursday.
Rosneft has reportedly signed a 10-year agreement to supply 500,000 barrels of crude oil per day to Indian private refiner Reliance, according to sources familiar with the deal. The deal is said to be worth around $13 billion.
India has worked to foster warm relations with Russia since its full-scale invasion of Ukraine and has refrained from sanctioning Russian oil. The southern Asian country overtook China as Russia’s top oil buyer in July, and is the world’s third-largest consumer of oil.
Refiners in India are profiting from a cheaper crude supply. Sanctions elsewhere have made Russian oil around $3 to $4 per barrel cheaper than alternatives.
A source told Reuters that the new deal would account for roughly half of Rosneft’s seaborne oil exports from Russian ports.
The contract is a timely development for Russian President Vladimir Putin, as European countries seek to reduce their reliance on Russian gas. The EU announced it had reached a deal for new sanctions Wednesday to combat Russia’s “shadow fleet” and blacklist dozens of oil and gas tankers helping Moscow earn billions from illicit fossil fuel sales.
Western sanctions have allowed India to absorb a huge amount of heavily discounted Russian hydrocarbons, and the newfound relationship has also seen India boost its own exports to Moscow, especially in high-tech sectors.
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