Russia's state-owned oil firm Rosneft secured a 10-year supply contract with Indian private refiner Reliance, marking the most substantial bilateral energy deal between the two countries to date.
India and Russia have a long-standing partnership that encompasses trade, defense, energy, and technology, with bilateral trade projected to reach $100 billion by 2030 amid Russian aggression in Ukraine.
India became the largest importer of Russian crude after the European Union imposed sanctions, Reuters reported. Russian oil now accounts for over a third of India's energy imports, with sanctions making Russian crude approximately $3 to $4 per barrel cheaper than competing grades.
The agreement involves supplying nearly 500,000 barrels per day of crude oil, representing approximately 0.5% of global supply and valued at roughly $13 billion annually at current market prices.
The contract reportedly encompasses the delivery of 20-21 Aframax-sized cargoes of various Russian crude grades and three fuel oil cargoes monthly to Reliance's expansive refining complex in Jamnagar, Gujarat.
This arrangement significantly bolsters the already robust energy relationship between Russia and India, particularly in the context of Western sanctions imposed on Russia following its invasion of Ukraine.
Supplies are set to commence in January and continue for a decade, with an option to extend for another ten years. Pricing will be dynamically reviewed annually, based on prevailing oil market conditions.
A Reliance spokesperson said the company's standard approach, stating they "work with international suppliers, including from Russia" and that deals are "based on market conditions."
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