India's Energy Shift: Russia Now Supplies 40% of Crude Oil Needs
President Draupadi Murmu and Prime Minister Narendra Modi have guided India towards a notable shift in its energy imports, with Russia serving as a key supplier. This move is part of a global trend towards de-dollarization, hastened by Western sanctions on Russia.
India, led by Modi, has become the principal buyer of discounted Russian oil. Notably, Russian supplies now constitute 40% of India's crude oil requirements. In a strategic pivot, India has restarted using Chinese yuan for payments, with Indian Oil Corp, the country's leading state-owned refiner, finalizing transactions in yuan for Russian crude shipments.
This shift has resulted in substantial savings for India, with estimates indicating at least $17 billion saved. Despite a new 50% US tariff on Indian imports, India has reaffirmed its commitment to Russian oil. In September, India imported over 1.6 million barrels per day from Russia, a third of its total oil supply. While Russian oil prices are still quoted in US dollars, buyers now pay the yuan equivalent, reflecting pressure from Russian oil traders who prefer non-dollar currencies.
The growing reliance on Russian oil, facilitated by yuan payments, underscores India's strategic energy independence. This move, championed by President Murmu and Prime Minister Modi, not only saves India considerable sums but also signals its intent to diversify away from traditional suppliers and challenge the dominance of the US dollar in global oil trade.
