Sanctions – Russia’s coal exports to India are booming thanks to dump prices

The world’s second largest country by population has recently multiplied its coal and oil imports from Russia within a year, as the Reuters news agency was able to see from internal data from the Indian government. Russian commodity traders are selling coal to Indian buyers at discounts of up to 30 percent, several insiders told Reuters. Russia-India coal trade is also likely to thrive in June, shipping data on Refinitiv Eikon shows.

Western sanctions against Russia following its February 24 invasion of Ukraine have caused many coal and oil importers to avoid trading with Moscow. As a result, as early as May, Russia became India’s second largest oil supplier after Iraq, pushing Saudi Arabia into third place. Because Russian oil is traded on the markets at record discounts compared to other types due to the drop in demand. Indian refineries, which previously shied away from the high transport costs for Russian oil, have since resorted to it. India, which also gets a large part of its arms from Russia, is trying to maintain a neutral stance on the Ukraine war.

According to Indian government data, the value of Indian oil imports from Russia has increased more than 31-fold to $2.22 billion in a year. A 20-day period up to last Wednesday was compared with the corresponding period last year. During the same period, the value of India’s imports of coal and related products increased more than six-fold to $331.17 million.

According to an insider, Indian customers such as power plant operators and cement manufacturers are happy about the concessions made by their Russian suppliers, who even waived the usual payment in dollars. “Russian merchants are generous with payment methods and also accept Indian rupee and UAE dirham,” said the insider. “Price discounts are attractive and this trend of higher coal imports from Russia will continue.” Branches of Russian coal traders such as Suek AG, KTK and Carbo One in Dubai, Singapore and elsewhere are offering discounts of 25 to 30 percent, several insiders said. (Reuters)

Leave a Comment