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India's oil trick just hit an EU sanction wall

11 snips
Jul 23, 2025
A new wave of EU sanctions on Russian oil could disrupt India's lucrative oil game. The discussion covers India's past dependence on discounted Russian crude and the looming threat these sanctions pose to profitable imports. As costs rise, there's a pressing need for India to rethink its energy strategy and seek alternative sources to sustain its billion-dollar oil ventures.
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INSIGHT

India's Oil Arbitrage Model

  • India capitalized on discounted Russian crude by refining and exporting fuel to Europe, profiting $15 billion last year.
  • This oil arbitrage operated within legal ambiguities until new EU sanctions aimed to shut it down completely.
INSIGHT

EU Sanctions Threaten Exports

  • EU sanctions banning petroleum products from Russian crude threaten India's oil exports to Europe.
  • This disrupts business for major refineries reliant on discounted Russian oil like Reliance and Naira.
INSIGHT

Economic Impact of Sanctions

  • Reduced Russian discounts increase India's oil import bill, widening its trade deficit and complicating inflation control.
  • Fuel price rises will eventually pass to consumers or fiscal deficits, causing simmering inflation rather than overnight spikes.
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