Indian companies started paying for Russian oil in Emirati dirhams — Reuters
In order to reduce the risks of violating Western sanctions, Indian oil refineries began to pay for most of their Russian oil supplies in the national currency of the UAE, dirhams. This was reported by Reuters with reference to transaction data provided by sources.
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As noted by the agency, although India does not recognize Western sanctions against Moscow, and the purchase of Russian oil cannot in any case violate them, banks and financial institutions are cautious about clearing payments in order not to inadvertently fall under the violation of many measures introduced against Russia after it invasion of Ukraine.
Indian oil refiners and traders are concerned that they may not be able to continue making payments in dollars, especially if the price of Russian oil rises above the limit set by the G7 countries and Australia in December.
This forced traders to look for alternative payment methods that could also help Russia in its efforts to de-dollarize its economy in response to Western sanctions.
Read also: G7 agreed on price ceilings for oil products from the Russian Federation at the level of $100 and $45
Previous requests by Indian oil refiners to pay traders for Russian oil in dirhams through Dubai banks were not successful, which forced them to return to the American currency, writes Reuters.
However, now the State Bank of India has started making calculations in dirhams, the sources of the agency said.
Indian oil refiners mainly buy Russian oil from traders from Dubai, including Everest Energy and Litasco, a division of the Russian oil company Lukoil.
Let’s remind
On December 5, an embargo on the supply of Russian oil to the European Union entered into force. Also, from that day on, a price ceiling for energy carriers of $60 per barrel was introduced on the part of the EU, G7 and Australia. Price restrictions allow countries outside the European Union to import oil from Russia, but prohibit the provision of insurance, ships and any services for the transportation of sea shipments of Russian oil, if the contracts for its sale do not provide for the conditions of the limit price at the level of $60 per barrel.
On February 3, the G7 countries and Australia announced a consensus on the introduction of price ceilings for Russian oil products. For production that trades at a premium to oil, it will be set at $100 per barrel.
Source: Ministry of Finance
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