Million barrels per day column chart showing Russian oil imports from India skyrocketing...

US energy envoy urges India to restrict Russian oil purchases

The Biden administration’s top international energy adviser has called on India not to go “too far” as it increases imports of cut-price Russian crude that has lost buyers in Europe.

Indian purchases of Russian oil transported by sea have increased as exporters cut prices from the Urals, the country’s main crude export stream, after European refineries began to avoid shipments and the EU decided to end its dependence on Russian energy after Moscow invaded Ukraine.

The deals are causing frustration in Western countries, which are paying higher prices for oil in part because of efforts to restrict Russian export revenues that are used to wage war.

Amos Hochstein, senior energy security adviser at the US State Department, said he had urged India not to take advantage of cut-price Russian oil as Western consumers pay record fuel prices.

“I said, ‘Look, we don’t have secondary sanctions that can prohibit your purchases from Russia,'” Hochstein told a Senate committee hearing on Thursday.

Million barrels per day column chart showing Russian oil imports from India skyrocketing...

“I would ask two things: ‘One, don’t go overboard. Don’t seem to take advantage of the pain that is felt in European homes and in the United States. Second, be sure to negotiate well, because if you don’t buy [the oil]no one else is.

Urals exports have sold in recent weeks for nearly $30 a barrel less than Brent, the international benchmark.

But Russian export volumes have held steady despite an extended Western embargo on its oil, while Brent has risen nearly 60% year-to-date to $123.07. per barrel on Thursday, offering a boon to the Kremlin.

“Russia is actually in a better position, in terms of income. . . at this stage of the war than they were at the beginning of the war,” said Ron Johnson, a Republican senator from Wisconsin, referring to Russia’s oil export revenues.

“If you look at it closely, just on the price they’re getting per barrel sold, then I would agree with you on that,” Hochstein said, but added that “the bigger picture was that ‘they had a harder time getting the money back in Russia’, as Western financial sanctions tighten against Moscow.

Indian imports from the Urals are expected to reach more than one million barrels a day in June, from zero before the invasion in January and February, according to data provider Kpler. Chinese oil imports rose more modestly due to Beijing’s recent shutdowns to control Covid-19, which dampened demand.

Million barrels per day column chart showing ... And Russian maritime exports to northwest Europe have plunged

India’s strategy was criticized by other US politicians on Thursday. Chris Murphy, a Democratic senator from Connecticut, suggested that this may change “our willingness to look away, as they have become more deeply integrated into both Russian energy sources and Russian military equipment.”

Chris Van Hollen, a Democratic senator from Maryland, did not name India but described countries that had increased their imports of Russian oil at reduced prices as “essentially war profiteers”.

The Indian Embassy in Washington did not immediately respond to a request for comment.

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