According to one of US Vice President Joe Biden’s economic advisers, India and China may have purchased more Russian oil than the US government had previously assumed.
He said that the recent drop in oil prices is being caused by the two big nations’ purchases of Russian oil, which are relaxing supply restrictions on international markets.
While Brent fell 5.2% to $108.62 per barrel, West Texas Intermediate fell 5.6% to $103.31.
Cecilia Rouse, the head of Biden’s Council of Economic Advisers, stated: “Right now, in particular, oil prices are particularly unpredictable.” in an interview with Bloomberg TV on Wednesday.
I’ve heard that part of the reason is that there is more supply on the market because China and India are actually buying more Russian oil than we might think.
Vladimir Putin has been selling Russian oil to the Asian markets at a discount amid high demand while West sanctions remain in place as a result of the Ukrainian crisis.
According to Gazprom Neft Chief Executive Officer Alexander Dyukov, at the beginning of 2022, over two-thirds of Russian petroleum was sold to Europe; today, about 50% of the country’s oil is heading to Asia.
According to the New York Times, which cited shipping statistics from the market research company Kpler, the majority of the extra oil has gone to China and India.
Russia surpassed Saudi Arabia as China’s top supplier thanks to a 28% increase in imports of Russian oil in May compared to the previous month.
India has grown from importing virtually little Russian oil to importing more than 760,000 barrels per day, making it the second-largest importer of Russian oil.
Additionally, The Wall Street Journal (WSJ) reported on Tuesday that the Indian government has encouraged state-owned oil corporations to purchase significant amounts of Russian crude as prices have fallen significantly due to Moscow’s conflict with Ukraine.
Despite the most recent wave of European sanctions, Indian businesses have managed to continue buying Russian oil, according to the study.
Rosneft, a Russian oil giant, reportedly permitted traders to pay for its crude months after delivery without a letter of credit from a bank in an effort to increase the appeal of its oil.