Russia has been waging an unprovoked war against Ukraine for three years now, and they’ve got a lot of money in their government savings. The Kremlin made a fortune, about $37 billion, by selling oil to India in 2023. A considerable amount of that oil was sent to India to be refined and then sold to the United States, to be more specific, amounting to $1 billion.
India started buying a lot more oil from Russia during the war, more than 13 times what they used to buy before Kremlin’s attack on Kyiv. In other words, India took the niche of Western countries, which stopped buying oil from Russia due to the anti-Russian international sanctions.
Even though it’s legal for India to buy oil from Russia, experts believe Russia might be using its shadow fleet to sell this oil to India. This shadow fleet is designed to hide the origins of the Russian oil and makes it very hard for the West target the companies and entities related to such operations.
Howard Shatz, RAND economist, states that according to public data from the Russian finance ministry, Russian federal revenue and expenditure were both at an all-time high in 2023. It should be noted that, Russia’s war expenditures had not been taken into account by the Russian finance ministry.
India used the excuse for oil imports of Russia, emphasizing that all New Delhi does is keeping the global prices low, as as it’s not competing with Western nations for the Middle Eastern oil. India’s Minister of Petroleum and Natural Gas Hardeep Singh Puri asserted that if India started buying more of the Middle Eastern oil, the oil price will be more than $75 or $76.
India’s intricate involvement in the global oil trade is underscored by the trajectory of oil products derived from Russian crude. Following refinement at facilities along India’s western coastline, some of the crude is subsequently exported to nations like the US and others that have imposed sanctions on Russian oil. Notably, products refined beyond Russian borders fall outside the scope of these sanctions and the experts have come up with a specific term for it, a “refinery loophole.”