India, the world’s third biggest oil import, hopes to convert the current global oil challenges from the Ukraine crisis into an opportunity to secure affordable energy, Oil Minister Hardeep Singh Puri said on Thursday, a day after the European Union failed to agree on a Russian oil price cap.
India, which rarely used to buy Russian oil because of costly logistics, has emerged as Russia’s second biggest oil client after China as some Western entities shunned Moscow purchases following its February invasion of Ukraine.
“At this time, the worry is not about from where we will get energy,” Puri said at a broadcaster Times Now summit. “It is a global challenge but we have and we will convert this into an opportunity. And I don’t foresee any difficulty in procuring energy and securing at affordable prices.”
The United States has stopped buying Russian energy and European nations will halt Russian crude and refined product imports from Dec. 5 and Feb. 5, respectively.
The Group of Seven nations, including the United States, as well as the European Union and Australia, are planning to implement a likely price cap of $65 to $70 a barrel on sea-borne Russian oil exports from Dec. 5.
Some Indian refiners are already getting Russian oil at below or near the prices cap levels.
The West has exempted Russian oil supplies via pipelines to Hungary and China, and exports from Sakhalin-2 projects to Japan. “So the question arises that on whom this price cap will be imposed, if these three large exemptions are there,” Puri said, indicating that the mechanism is aimed at supplies to India.
Puri, however, said he was not concerned about disruption to oil supplies post-Dec. 5, adding that India has been rapidly diversifying its crude sources and could buy more oil from the United States, Guyana and other nations in the coming years.