India's Russian Oil Imports Prevented Global Price Surge, Says Minister Hardeep Singh Puri

New Delhi: India’s decision to purchase Russian oil during a period of global economic volatility has played a crucial role in preventing a sharp spike in international oil prices, according to Union Petroleum and Natural Gas Minister Hardeep Singh Puri. Speaking at the Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC) on Thursday, Puri explained that India’s strategic move helped stabilise the global energy market, averting a price surge that could have seen oil climb to $200 per barrel.

“If the Indian government hadn’t bought Russian oil, the global oil price would have gone up to $200 for everyone,” Puri said, underscoring the significant impact India’s oil imports had on global energy prices. The minister’s remarks came amid ongoing debates about energy security, pricing and the geopolitical dynamics of global oil trade.

India’s Role in Global Oil Market Stability

In his address, Puri highlighted the importance of India’s role in maintaining market balance during a period of extreme uncertainty following the war in Ukraine and global supply disruptions. The minister emphasised that India’s purchase of Russian oil was a calculated decision that helped stabilise global oil prices by preventing a shortage in supply. He pointed out that, without India’s demand, the vacuum created by the reduced availability of Russian oil could have driven up prices exponentially.

“If India had stopped purchasing and shifted its five million barrels to Gulf suppliers, global oil prices would have surged to $200 per barrel,” Puri explained. “I think we did everybody a favour,” he added, referring to the global community’s reliance on stable oil prices for economic stability.

Shift in Imports and Global Competition

Puri also addressed the shift in India’s oil sourcing, noting that India had reduced its Russian oil imports by approximately 10% in October due to increasingly competitive pricing from other suppliers. While Russia had been a major supplier of discounted crude oil, other suppliers in the market had started offering competitive rates, prompting India to diversify its sources.

“The OPEC position doesn’t involve price negotiations and healthy competition is underway,” Puri said. “If one source is unavailable, there are always alternatives.” The minister reiterated that India’s decisions were driven by competitive pricing and the need to secure the best deals for the country’s oil companies, which ultimately benefits consumers by keeping fuel prices in check.

Defending India’s Energy Strategy

Puri was quick to defend India’s oil purchases from Russia, responding to critics, who have questioned the country’s energy strategy. He pointed out that Russian oil was never formally under sanctions, but was subject to a price cap that Indian companies adhered to. Puri also highlighted that many European and Asian countries had continued to import Russian energy, including crude oil, diesel and LNG, despite geopolitical tensions.

“Some ill-informed commentators have talked about restricting India, but many European and Asian countries have also bought significant amounts of crude oil, diesel, LNG and rare earth minerals from Russia,” Puri said, emphasising that India’s energy decisions were based on securing the best deal for its citizens and the country’s long-term energy needs.

Focus on Energy Security and Affordability

India, with its large and growing energy demands, has consistently prioritised the steady availability, affordability and sustainability of energy for its citizens. Puri reaffirmed that this remains the country’s top priority, with over 700 million people relying on affordable energy to fuel daily life and economic activity.

“We need to ensure these priorities for our 70 crore citizens, who visit a petrol pump every day. That’s our top priority,” Puri said, highlighting India’s success in reducing fuel prices over the past three years despite the global rise in energy costs.

India’s careful balancing of energy imports and domestic requirements, particularly during the turbulent global energy landscape, illustrates the country’s growing influence in the global oil market and its commitment to ensuring stable and affordable energy for its people. As global oil markets continue to face uncertainty, India’s role in preventing extreme price volatility has proven to be an invaluable contribution to global energy security.

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