India, the “Laundry” of Russian oil, and it is not alone
A new report from the Center for Research on Energy and Clean Air (CREA) has found that European countries, which previously banned imports of Russian oil, are instead importing huge quantities of petroleum products from India, China, the United Arab Emirates, Singapore and Turkey, states that are real "laundries" of dirty Russian oil.
The report, titled Laundromat: How the price cap coalition whitewashes Russian oil in third countries , reveals that Western countries bought $42 billion of recycled Russian crude in the form of various petroleum products from Russia-friendly nations, with India in head to the other five countries. For example, India's diesel exports tripled to ~1,600,000 bpd in March 2023, compared to a year ago, making diesel a major component of India-EU trade.
“Countries in the price cap coalition have increased imports of refined petroleum products from countries that have become the largest importers of Russian crude oil. This is an important loophole that may undermine the impact of the sanctions on Russia,” the report reads.
According to the CREA report, most of the petroleum products were exported from two ports in Gujarat, arguing that this could constitute a "circumvention of sanctions" unilaterally imposed by the US and Europe. India, in particular, has offered a back door for Russian oil imports to Britain, hampering the country's efforts to limit funding to the Kremlin. Some British buyers have effectively replaced direct imports from Russia with imports from Russian-fed refineries, thereby indirectly supporting the Russian oil industry.
While this supply chain is de facto legal under UK and European standards, it cannot be overlooked as it is yet another covert way of financing Putin's war. Before the war started almost a year ago, it was quite rare for Indian refineries to process Russian crude. Refiners have always exported to Europe, but now they are exporting even more because it is more attractive as diesel prices in Europe are higher, and they are also buying more Russian crude because Russia is offering steep discounts.
Oleg Ustenko, adviser to Ukrainian President Volodymyr Zelensky, says these companies are "exploiting weaknesses in the sanctions regime". Kpler data revealed that the Jamnagar refinery on India's west coast imported 215 shiploads of crude and fuel oil from Russia during 2022, 4 times more than it purchased in the previous year. Meanwhile, the UK has imported a total of 10 million barrels of diesel and other refined products from Jamnagar since the start of the war, 2.5 times what it bought in 2021, with Trafigura, Shell Plc, BP Plc, PetroChina Co. and Indian multinational conglomerate Essar Group as primary buyers.
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The article India, the "Laundry" of Russian oil, and it's not the only one, comes from Scenari Economics .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/lindia-la-lavanderia-del-petrolio-russo-e-non-e-la-sola/ on Tue, 02 May 2023 08:00:04 +0000.