Russia Sells Crude to India Under G7 Price Cap, Breaking Vow to Cut Off Abiding Countries

  • Russia is shipping millions of barrels of oil to India on Western-insured tankers, the FT reported Friday.
  • It’s the first sign Moscow may be breaking Putin’s vow to shun countries that accept a G7 price cap.
  • The cap has already sent its oil exports nosediving, and looks set to hit Russia’s economy.

President Vladimir Putin has promised to refuse to sell Russian crude to countries that stick by the G7 price cap on its oil — but recent India-bound cargoes signal that vow may have been broken.

Moscow has loaded millions of barrels of crude onto seven Western-insured tankers since December 5, when the price cap came into effect, the Financial Times reported Friday, citing Kpler data. It’s the first sign that Russia is backtracking on its threat.

Under the price cap rules, buyers of Russian oil can only access European shipping and insurance services if they have purchased it for $60 a barrel or less. The measure aims to limit Moscow’s ability to fund its war against Ukraine, while still keeping Russian oil flowing through global markets to prevent a shortage.

Putin has called the price cap “stupid” and said Moscow won’t sell its crude to countries that abide by the measure, which came in alongside an EU ban on seaborne imports of Russian oil.

But the sanctions have already driven a sharp fall in its exports, spelling trouble for Russia’s economy in the long term. The country’s central bank has warned of “economic shocks”, while the International Monetary Fund has forecast its GDP will shrink 3.4% this year.

At least seven tankers holding about 5 million barrels of Russian crude left Moscow’s Baltic ports en route to refineries in India, per the FT. India has been a key buyer of Russian crude in 2022, snapping up the country’s oil at steep discounts as Moscow battled Western sanctions over the Ukraine.

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