India is one of the largest importers of Russian crude (Urals) which is trading around USD 50 - 55 per barrel (a 30-35% discount to WTI / Brent). This discount provides massive support to its already widening Current Account Deficit (CAD) and ensuring country’s energy security. Just look at the following December crude oil import numbers from India.
Russian Ural shares as a percentage of total crude oil import into India has increased to 25% in December 2022 which was a meagre 1% in February 2022. The Russian crude oil imports has increased by almost 30% in December 2022 vis-a-vis November 2022.
During the same period, the crude oil imports from USA and UAE has declined by 23% and 10%, respectively. UAE seems to be prioritizing Western markets where buyers are willing to buy crude oil at a premium.
Going ahead, it remains to be seen if Russia would be able to maintain the Ural at discounted rates if and when the global crude prices cross USD 90 mark on the back of USD 60 per barrel price cap imposed by the West.
