Russian Crude Gets Cheaper for India Amid Trump’s Tariff Attacks, Discounts Rise

Amid Trump’s rising pressure on India to cut its oil imports from Russia, the latter’s crude is getting cheaper for Indian buyers. This is even after the South Asian country is facing steep tariffs from the U.S. government, rising up 50% on Indian goods.

In a conversation with Bloomberg, people who received offers for the Russian grade said that the price of Urals crude has dipped to a discount of $3 to $4 a barrel to Brent on a delivered basis. The individual spoke on the condition of anonymity as they were discussing sensitive information. The price is for cargoes that will load in late September and October, they added.

India became Russia’s major importer of crude after the start of the Ukraine war in 2022 however the country was slapped with the crushing US tariffs for the trade very recently. 

Amid U.S. President Donald Trump’s repeated criticism, India has now got closer to longtime rival China.  While attending the Shanghai Cooperation Organization summit in China few days back, Prime Minister Narendra Modi said that the country and Russia share a “special” relationship. He also met Chinese President Xi Jinping and the two leaders pledged to be partners rather rivals, announcing steps to rebuild ties.

Among the harshest criticism against India, was the one from White House adviser Peter Navarro. On Monday, Petroleum and Natural Gas Minister Hardeep Puri challenged his blunt language and argued that Russian flows had helped to shield the global economy from a price spike. His remarks came in a column written for The Hindu newspaper.

Despite a brief pause in early August, Indian refiners have continued to take Russian oil and now cheaper Urals are likely to attract strong buying interest. According to the people quoted above, last week, the grade was being offered at a discount of around $2.50 a barrel, wider than $1 in July. That compares with US crude recently bought by some refiners, which was priced at around a $3 premium, they noted.

State-run and private processors have received 11.4 million barrels of Russian crude between August 27 and September 1, as per data from Kpler and reports from port agents. One cargo originated from a US-sanctioned vessel called the Victor Konetsky via a ship-to-ship transfer.

Urals is Russia’s flagship oil and ships from the nation’s western ports. China, which hasn’t faced the same condemnation as India, is the biggest importer of Moscow’s crude, which arrives via pipeline and tankers.