By Nidhi Verma
NEW DELHI (Reuters) – The average price of Russian oil delivered at Indian ports in July dropped to the lowest since Moscow’s invasion of Ukraine in February last year, according to Indian government data.
India received Russian oil at an average price of $68.09 per barrel in July, marginally down from $68.16 in June and sharply lower than $99.58 in July 2022, according to Reuters’ calculations based on the latest data posted on Indian trade ministry’s website.
Refiners in India largely buy Russian oil on a delivered basis with sellers arranging for shipping and insurance.
The average cost of Russian oil in July was lower than that from Iraq and Saudi Arabia. The price of oil from Iraq and Saudi Arabia in July averaged $72.69 and $81.68, respectively, the data showed.
India depends on imports to meet more than 80% of its overall oil needs and rarely bought Russian oil in the past due to high transportation costs.
The country has emerged as the biggest buyer of seaborne Russian crude since Moscow’s invasion of Ukraine more than a year ago.
However, India’s imports of oil from Russia dropped in August to a seven-month low, trade flow data by Kpler and Refinitiv shows, as refiners cut purchases due to maintenance outages and narrowing discounts.
India’s monthly imports of Russian oil have been declining since June as discounts began to shrink.
Discounts on Russian oil for October loading are below $5 per barrel, dissuading some buyers from purchases as the oil price at Russian ports surged above the $60 a barrel ceiling fixed by western nations to cut Moscow’s oil revenue.
Indian refiners could cut imports of Russian oil due to narrowing discounts and payment problems, a government source said in July.
(Reporting by Nidhi Verma; Editing by Sharon Singleton)