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Is British Petroleum Flouting G7 Price Cap on Russian Oil in the Indian Market?
Is British Petroleum Flouting G7 Price Cap on Russian Oil in the Indian Market?
Sputnik India
Russian crude has been regularly trading above the $60 barrel price cap set by G7 countries since at least June this year, an energy analyst has told Sputnik India.
2023-10-17T20:29+0530
2023-10-17T20:29+0530
2023-10-17T20:29+0530
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Russian crude has been regularly trading above the price cap set by G7 countries since at least June this year, an energy analyst has told Sputnik India.Futures on Brent Crude and West Texas Intermediate (WTI), the major benchmarks of oil prices, have witnessed their biggest spike since April due to concerns over supply after escalation of hostilities in the Middle-East.Oil futures at Brent Crude closed at $89.79 per barrel on Tuesday, while WTI oil price was trading at just over $85 per barrel on Tuesday.The analyst estimated that the rise in prices on both the major global benchmarks would prompt companies around the world to look towards sourcing crude from Russia.British Petroleum-Jio Joint VentureIn February 2022, BP announced that would“exit its 19.75 percent shareholding in Rosneft and its other business in Russia”, suffering a loss of over $24 billion, according to a company statement.At present, the Reliance-BP Mobility Limited (the name of BP joint venture) is one of nine private companies selling petrol and diesel in the Indian retail market, according to information made available by India’s petroleum and natural gas ministry.The petrol pumps operate under the banner of Jio-BP.Importantly, Reliance Industries Limited has emerged as one of the biggest importers of crude from Russia this year, according to data by energy intelligence firm Vortexa cited in media.Overall, Russia has emerged as the top supplier of crude to India this year. Bloomberg reported that India imported around 1.78 million barrels a day of Russian crude in September, the highest in seven months.The Indian political leadership has consistently rejected calls by western countries to reduce its crude imports from Russia. New Delhi has said that sourcing crude serves the interests of the Indian consumer.Business Dynamics of BP-Reliance JVExplaining the business dynamics of BP, an analyst at a leading Indian firm told Sputnik India that BP has been looking to “consolidate its business” through demergers and JVs to boost business profitability.The expert said that through the JV, RIL was trying to leverage BP’s capabilities in the upstream, which involves oil and gas exploration.They noted that RIL was focussed more on expanding its upstream presence in recent months.BP has refused to comment for the story.
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Is British Petroleum Flouting G7 Price Cap on Russian Oil in the Indian Market?
The G7 announced a price cap on Russian crude in December. The UK has imposed a Russian oil import ban. But BP may be profiteering from marketing Russian crude.
Russian crude has been regularly trading above the price cap set by G7 countries since at least June this year, an energy analyst has told Sputnik India.
The analyst said that the price of Russian Urals grade crude on the international market is projected to go up further since the eruption of Israel-Hamas War in the Middle-East, a region which is the most significant petroleum producer globally.
Futures on
Brent Crude and
West Texas Intermediate (WTI), the major benchmarks of oil prices, have witnessed their
biggest spike since April due to concerns over supply after escalation of hostilities in the Middle-East.
Oil futures at Brent Crude closed at $89.79 per barrel on Tuesday, while WTI oil price was trading at just over $85 per barrel on Tuesday.
The analyst estimated that the rise in prices on both the major global benchmarks would prompt companies around the world to look towards sourcing crude from Russia.
British Petroleum-Jio Joint Venture
Global oil and gas giant British Petroleum (BP) announced a 49:51 Joint Venture (JV) with Reliance Industries Limited (RIL) in October 2021, four months before Russia’s Special Military Operation in Ukraine.
In February 2022, BP announced that would“exit its 19.75 percent shareholding in Rosneft and its other business in Russia”, suffering a loss of over $24 billion, according to a company statement.
At present, the Reliance-BP Mobility Limited (the name of BP joint venture) is one of nine private companies selling petrol and diesel in the Indian retail market, according to information made available by India’s petroleum and natural gas ministry.
The petrol pumps operate under the banner of Jio-BP.
Importantly, Reliance Industries Limited has emerged as one of the biggest importers of crude from Russia this year, according to data by energy intelligence firm Vortexa cited in media.
Overall, Russia has emerged as the
top supplier of crude to India this year. Bloomberg reported that India imported around 1.78 million barrels a day of Russian crude in September, the highest in seven months.
The Indian political leadership has consistently rejected calls by western countries to reduce its crude imports from Russia. New Delhi has said that sourcing crude serves the interests of the Indian consumer.
Business Dynamics of BP-Reliance JV
Explaining the business dynamics of BP, an analyst at a leading Indian firm told Sputnik India that BP has been looking to “consolidate its business” through demergers and JVs to boost business profitability.
The expert said that through the JV, RIL was trying to leverage BP’s capabilities in the upstream, which involves oil and gas exploration.
They noted that RIL was focussed more on expanding its upstream presence in recent months.
“On the downstream, which includes distribution and marketing, RIL has a strong presence in India. It is here that BP could benefit from Reliance’s expertise by tapping into the vast Indian consumer market,” the analyst said.
BP has refused to comment for the story.
