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'US won't impose sanctions on India for purchasing Russian oil despite oil price cap': Top Energy official

Notably, both the EU and the US adopted further price caps for seaborne Russian petroleum products including diesel and fuel oil last week.

Ajeet Kumar Written By: Ajeet Kumar @Ajeet1994 New Delhi Updated on: February 09, 2023 6:21 IST
Russin oil depot
Image Source : AP Russin oil depot

The United States on Wednesday confirmed that it was not planning to impose any sanctions on India, amid the fact New Delhi exporting record-high Russian oil irrespective of the European Union and West imposed price cap on energy resources. According to the statement released by US Assistant Secretary for Energy Resources Geoffrey Pyatt, the energy security agenda that India and the US were pursuing together was "particularly important" in light of what Russian President Vladimir Putin has done over the past years to disrupt global energy markets. 

EU, G7 partners agree on price cap on Russian petroleum products

Notably, both the EU and the US adopted further price caps for seaborne Russian petroleum products including diesel and fuel oil last week. According to President of the European Commission, Ursula von der Leyen, two price levels were set for Russian petroleum products: one for ”premium-to-crude” petroleum products, such as diesel, kerosene and gasoline, and the other for ”discount-to-crude” petroleum products, such as fuel oil and naphtha, reflecting market dynamics. The maximum price for premium-to-crude products will be $100 per barrel and the maximum price for discount-to-crude will be $45 per barrel. The Price Cap Coalition is composed of Australia, Canada, the EU, Japan, the UK, and the US. 

US claims all goals are accomplished 

Despite immense pressure from the West, New Delhi has not adopted any price cap and in fact, exporting more oil from Moscow at a far-discounted rate. Speaking about India's staunch decision, the US official underscored that the main goal of hampering the energy sector of Moscow was achieved, noting the fact New Delhi exporting oil at a much lower price. "Even though India isn't a participant in the price cap, it has effectively used its negotiating leverage which it derives from the price cap and the fact that large portions of the global market are no longer accessible to Russia, to drive down the price of Russian crude," he noted. "It's a benefit to India and the Indian economy. It also helps to advance our two goals of stabilising the global market and denying resources to the Kremlin," he added. 

Ukraine urges US to impose sanctions on India

Further, US Assistant Secretary of State for European and Eurasian Affairs, Karen Donfried, in a statement, confirmed that Pentagon was not considering imposing any sanctions on India for its purchase of Russian oil. In fact, she asserted that the relations with India are most crucial for the US too. 

"We're not looking to sanction India. Our partnership with India is one of our most consequential relationships," Donfried on a Ukrainian lawmaker urging the US to sanction India if it keeps buying Russian energy. 

India imports 85% of its crude oil needs

It is worth noting that India is the world’s third-largest oil-consuming and importing nation. It imports 85 per cent of its crude oil needs. Crude oil is converted into fuels like petrol and diesel at refineries. However, ever since the war between Russia and its neighbouring nation started last year, the West and Europe imposed stringent sanctions on its energy. This resulted in Russia's offering more discounts to its oldest ally, India. 

Also Read: India-Russia relations 'under stress' amid war and 'West interference', says top Moscow official

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