While the US and EU are being forced to pay record prices for gas as “the cost of standing up for freedom,” India is buying up cheap sanctioned Russian oil, refining it, and then selling it to the US and EU for huge profits, according to a report by the Wall Street Journal (WSJ).
The US has reluctantly given India permission to buy Russian oil because India has threatened to cut its ties with America and ally with China if the US dares to sanction them. And now, while Americans and Europeans are being forced to pay record prices for gas, the free nation of India is buying oil from Russia for a whopping $35 off a barrel and selling it back to the US in an interesting scheme.
According to the information published by WSJ, “Russian oil producers stay one step ahead of sanctions.” It is said that yes, Europe has targeted Russian crude with its toughest sanctions, but shippers and refiners are getting the oil to market by obscuring its origins.
Some fuels believed to be partially made from Russian crude landed in New York and New Jersey last month, the Journal reports. It is also assumed that the cargoes were brought through the Suez Canal and across the Atlantic from Indian refineries, which have been big buyers of Russian oil, according to shipping records, Refinitiv data and analysis by Helsinki-based Centre for Research on Energy and Clean Air.
WSJ noted that India’s imports have skyrocketed to 800,000 barrels a day since the start of the Russian special operation, compared with 30,000 barrels a day previously, according to commodity-markets data company Kpler.
“A refinery owned by Indian energy giant Reliance Industries Ltd. bought seven times more Russian crude in May, compared with prewar levels, making up a fifth of its total intake,” according to Kpler.
Reliance chartered an oil tanker to carry a cargo of alkylate, a gasoline component, departing from the nearby Sikka port on April 21 without a planned destination. Three days later, it updated its records with a US port and sailed over, discharging its cargo on May 22 in New York, WSJ reports.
“What likely happened was Reliance took on a discounted cargo of Russian crude, refined it and then sold the product on the short-term market where it found a U.S. buyer,” said Lauri Myllyvirta, lead analyst at the Centre for Research on Energy and Clean Air.
Our investigation shows refined oil products being shipped from India to U.S. and Europe, from a refinery that has become the largest new buyer of Russian crude oil. This is an important loophole to close.https://t.co/sWG9F8K9T9
— Lauri Myllyvirta (@laurimyllyvirta) June 1, 2022
He continued, saying that the share of Russian crude oil in the oil shipments to the Reliance Jamnagar refinery has risen from less than 5 per cent before the special operation to over 25 per cent in the past 30 days.
“About half of the refined oil shipments from the refinery were re-exported to other countries,” he said.
In addition, it is stated that Indian refined oil-product exports, beefed up by cheap Russian supplies, have grown sharply since the beginning of the special operation. Daily shipments to Europe have risen by a third and to the US, by 43 per cent, on a quarterly basis.