The drive by private sector refiners Reliance Industries Ltd (RIL) and Rosneft-owned Nayara Energy to import larger quantities of crude oil from Russia is likely to impact India’s diplomatic standing with Western allies and West Asia, currently the country’s top suppliers. Last month, Reliance and Nayara accounted for a combined 69 per cent of oil shipments from Russia, making it India’s second-largest oil supplier last month, overtaking traditional ally Saudi Arabia, and just behind Iraq. Urals trades at significant discounts to the benchmark Brent, making it a compelling option for refiners in the public and private sectors, with global prices soaring on account of supply dislocations following the Ukraine-Russia crisis. While it is true that import decisions are taken by private sector entities, the government may need to address the question of whether this is a desirable situation for the country.
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