A big controversy has started in American politics over the exemption given by America to India to buy Russian oil. Opposition Democrat MPs have demanded President Donald Trump to immediately withdraw this decision. Amidst this uproar, India’s refineries have continued to buy large quantities of oil from Russia to meet their energy needs. Reliance Industries has ordered millions of barrels of oil for March delivery.
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How much oil did Reliance buy and what are the reasons for it?
Reliance Industries Limited (RIL) has ordered a large quantity of oil from Russia for March delivery. Some important things related to this oil purchase are as follows:
Reliance has purchased at least 60 lakh barrels of Russian oil. This oil is mainly of Urals grade which has been purchased at a premium. The supply to the Middle East has been affected due to the ongoing war between Iran and Israel.
Due to tension in the Middle East, 40% of India’s oil supply was in danger. If India did not ensure this supply from other countries, there could have been a huge jump in the prices of petrol and diesel in the domestic market. Because of this, Russian oil has become an important option for Indian companies.
Why are American lawmakers protesting?
The US Treasury Department had recently given temporary exemption of 30 days to India to buy Russian oil. This exemption is only for the oil which was already loaded on ships at sea.
Democrat lawmakers have demanded the Trump administration to withdraw this 30-day exemption. The US Energy Secretary called this a practical step so that oil prices remain under control around the world. America wants this oil to stop from going to China and to maintain supply in the global market.
Indian government officials have made it clear that India buys oil only keeping in mind its energy security and national interest. To stop the rise in the price of crude oil in the international market, America had implemented this stopgap measure, on which both the countries are now eyeing.
