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Reliance Industries inks one-year deal with Russia's Rosneft for oil purchase in roubles: Report
Image Credit: ril.com

Reliance Industries inks one-year deal with Russia's Rosneft for oil purchase in roubles: Report

| @indiablooms | 28 May 2024, 09:14 pm

Mumbai: Mukesh Ambani-led Reliance Industries, which operates the world's largest refining plant, has signed a one-year agreement with Russia's Rosneft to purchase at least 3 million barrels of oil monthly in roubles, Reuters reported.

This shift to rouble payments follows Russian President Vladimir Putin's initiative for Moscow and its trading partners to find alternatives to the Western financial system amid U.S. and European sanctions.

The term deal with Rosneft allows privately-run Reliance to secure oil at discounted rates, especially as the OPEC+ group of oil producers is expected to extend voluntary supply cuts beyond June.

The OPEC+ group, which includes the Organisation of the Petroleum Exporting Countries (OPEC) and allies like Russia, is scheduled to discuss output cuts in an online meeting on June 2.

India, the world's third-largest oil importer and consumer, has become the largest buyer of seaborne Russian crude since Western countries stopped purchases and imposed sanctions on Moscow following Russia's 2022 invasion of Ukraine.

India has also paid for Russian crude in rupees, dirhams, and Chinese yuan.

Meanwhile, state-owned Indian refiners have been purchasing Russian oil on the spot market due to difficulties in finalizing term supplies for this year, Reuters had reported earlier.

"India is a strategic partner for Rosneft oil company," the Russian company said in an emailed response to questions from Reuters, adding that it does not comment on confidential agreements with partners.

"Cooperation with Indian companies includes projects in the field of production, oil refining and trading of oil and petroleum products."

Rosneft also said that commercial approaches to determining the value of sold crude are the same for all companies, regardless of whether they are private or state-controlled.

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