India, which replaced Saudi Arabia as Europe’s top fuel supplier for 2024, has also begun accepting Russian cargoes via EU-sanctioned ships, the report warns — a development that’s now sparking anger from inside the bloc.
“By allowing third countries like India and Turkey to re-export petroleum products made from Russian oil … the EU provides the Kremlin with the ability to replace its lost market” in Europe, said Martin Vladimirov, a senior analyst at CSD, which analyzed information from several firms tracking customs data and sanctions compliance.
“The additional revenues have been able to sustain the enormous costs of the war effort in Ukraine,” he added.
Brussels is well aware of the so-called refining sanctions loophole, which allows the EU to legally buy Russian-origin fuels as long as these are processed in other countries. But the new findings illustrate how the bloc continues to fund Moscow despite its attempts to throttle the Kremlin’s revenues, around half of which come from fossil fuel exports.
The extra cash is a welcome relief for Russia, which increasingly needs funds to shore up its budget as the ruble tanks and defense spending explodes, while it also faces slowing growth and high inflation.
Overall, the EU’s fuel imports from India have actually dropped 9 percent so far this year compared to 2023, while its purchases from India’s three main refineries — the RIL Jamnagar, Vadinar and state-owned New Mangalore facilities — known to process Russian oil rose by a modest 4 percent. But the amount the bloc paid for those purchases has risen markedly.
AIM-120-AMRAAM on December 7th, 2024 at 14:11 UTC »
That’s how the system(sanctions) are designed to work. I don’t see anything wrong with what Indian, EU or US are doing.
US has not asked India to cut Russian oil purchases, American official says
U.S. Treasury assistant secretary for economic policy Van Nostrand said that buyers can purchase Russian oil at deeper discounts outside of the price cap mechanism, if they do not use Western services like insurance and broking, thus limiting Moscow’s sales avenues.
[US Ambassador to India Eric Garcetti emphasised that Washington wanted India to buy Russian oil at discounted prices to contain the rise in the price of an essential commodity and curtail Russia’s funding in the context light of its war in Ukraine.
Speaking in an interview with CNN-News18, the US Ambassador said “we recognised that oil was a necessity for all economies” while answering a question on his somewhat suggestive indication that the US wanted India to continue to buy Russian oil.
AravRAndG on December 7th, 2024 at 13:27 UTC »
One cannot just remove such a huge oil source from the market without skyrocketing the price, which no one wants
Dean_46 on December 7th, 2024 at 13:26 UTC »
I'm from India and blog about the Ukraine war. The problem for Europe was that after shutting some of its refineries, it does not have the capacity to refine all the oil it imports. It was buying refined oil from Russia. In Russia's absence, India is the only country with excess refining capacity - and low processing cost. The EU worded its sanctions regulations to say that once Russian crude is blended with oil from other sources and refined, its no longer Russian. The refining in India is done with a `wink and nod' from Europe.