The US has offered the government of Asia’s second largest economy to go along with the ceiling on Russian oil prices.
The “Orient Express” of Russian oilmen, which carries barrels to Asia instead of Europe, continues to weaken. In the week ending Aug. 26, oil supplies from Russia to Asian customers fell to their lowest level since the first month of the war, Bloomberg calculated based on tanker tracking data.
China, which began cutting back more purchases in July, was joined by India, which since spring has been buying oil that fell under a Western European boycott.
Over the course of the month, the flow of Russian oil to India decreased by 40 percent: at the end of July it was 960,000 barrels per day, in mid-August – 740,000 barrels, and last week – 570,000.
China simultaneously bought 810,000 barrels a day – 35 percent less than in early June.
Another 340 thousand barrels per day were taken from Russian ports by tankers that did not indicate the destination. But even if all that volume went to Indian or Chinese refineries, shipments to Asia would be the lowest since early April (1.72 million barrels a day).
“Putin’s blackmail failed.” The European Union has stockpiled gas
Problems in the Indian market emerged for Russian oilmen after a delegation of US officials led by Deputy Treasury Secretary Wally Adeimo, the sanctions policy coordinator in Washington, visited New Delhi.
The US offered the government of Asia’s second largest economy to join the ceiling on the price of Russian oil – that is, not to buy barrels more expensive than $40-60. Nothing has been publicly announced about the outcome of the talks. But according to Bloomberg, India’s de facto government said no, saying the deal needed a “broader consensus”.
Russia has threatened to completely stop the supply of raw materials to countries that will introduce the ceiling. And in this case, India, which imports 85 percent of its fuel needs, has to buy oil on the market at world prices, while today it is available at a discount of about $18 per barrel .
Adeimo also asked Indian authorities to carefully monitor where products made from Russian oil go – for example, plastic should not enter the US market, a source told Bloomberg.
Despite the fact that it is not yet possible to involve India in the idea of a price cap, the G7 countries agreed to this mechanism at a meeting of finance ministers on Friday. From December 5, when the EU oil embargo began, services for the transportation and insurance of Russian barrels will be subject to sanctions if the price exceeds the established limit. The limit itself, however, has not yet been approved.
US authorities fear that too low a price – for example, $40 per barrel – will lead to a reduction in Russian production, which is adjusting after the “gas famine” – oil.
The EU embargo on Russian oil will leave 1.25 million barrels per day unsettled, analysts at Goldman Sachs estimate. It is almost impossible to sell all this volume in China: Chinese refineries are already buying the possible maximum of Russian varieties, and due to technical features, they cannot “melt” any more, the analyst said of Kpler Humayun Falakshali.
As a result, Russia will have to cut production, the International Energy Agency believes. According to his forecast, at the beginning of next year, oil production in Russia will decrease by 20 percent, to 8.8 million barrels per day – the lowest level since 2002-03.
News from Correspondent.net on Telegram. Subscribe to our channel Athletistic
Source: korrespondent
I am David Wyatt, a professional writer and journalist for Buna Times. I specialize in the world section of news coverage, where I bring to light stories and issues that affect us globally. As a graduate of Journalism, I have always had the passion to spread knowledge through writing.