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Modi, Narendra

Trump Claims India to Scale Back Russian Oil Purchases, Indicating Easing of Tariffs

Strategic Insights

— 2 min read

US President Donald Trump has claimed that Indian Prime Minister Narendra Modi has assured him that India will stop buying Russian oil, amid ongoing tensions between the two countries over energy imports. This development has fuelled hopes that a significant hurdle in Indo-US ties may soon be removed, prompting Washington to ease its tariff pressure on New Delhi. Trump made the statement during a press conference at the White House on Thursday, citing a purported conversation with Modi. However, the Indian government has not confirmed the conversation or the claim.

India has consistently maintained that buying discounted Russian oil has helped keep in check the domestic retail prices of motor fuels as well as the price of international crude oil. India's crude imports from Russia in October were around 1.8 million barrels per day, up 250,000 BPD month on month, and 50,000 BPD year on year. The Ural crude is being offered at a discount of $2-$3 per barrel. India has been procuring 30-35 per cent of its crude oil requirements from Russia.

Despite the uncertainty surrounding Trump's claim, Congress leader Rahul Gandhi has accused Modi of being "frightened" of Trump and allowing him to "decide and announce" that India will not buy Russian oil.

Key Takeaways:

  • India has been procuring 30-35 per cent of its crude oil requirements from Russia.
  • India's crude imports from Russia in October were around 1.8 million barrels per day, up 250,000 BPD month on month.
  • The Ural crude is being offered at a discount of $2-$3 per barrel.
  • India faces a punitive tariff of 50 per cent on two-thirds of its exports to the US.
  • Shipments to the US plunged to $5.5 billion in September, the first full month after the 50 per cent tariff took effect.
  • Indian commerce secretary Rajesh Agarwal has offered to buy more petroleum products from the US to bridge the $42.7-billion trade gap between the two countries.

Statistics:

  • India has been procuring 30-35 per cent of its crude oil requirements from Russia.
  • India's crude imports from Russia in October were around 1.8 million barrels per day.
  • The Ural crude is being offered at a discount of $2-$3 per barrel.
  • Shipments to the US plunged to $5.5 billion in September.
  • India faces a punitive tariff of 50 per cent on two-thirds of its exports to the US.
  • Indian commerce secretary Rajesh Agarwal has said that India may buy more cooking gas (LPG) from the US, reducing its reliance on West Asia.

Sources:

  • "Trump says India will stop buying Russian oil after PM Modi's assurance". PTI.
  • "India's crude imports from Russia rise to 1.8 million barrels per day in October". Kpler.
  • "India's reliance on Russian oil may be a hurdle in Indo-US ties". Reuters.
  • "India faces 50% tariff on two-thirds of its exports to US". Global Trade Research Institute.
  • "Indian commerce secretary Rajesh Agarwal offers to buy more petroleum products from the US". ABP Private Limited.

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