Market Conditions, Not Political Punishment, Account For India’s New Russian Oil Prices

It’s important to debunk this false narrative before it misleads more of the public.

India has reportedly purchased around 30 million barrels of Russian oil following the US’ temporary sanctions waiver for Russia oil at sea at the time of this decision, which was soon thereafter expanded to include all countries on this condition, but the discount is much less than before. Bloomberg reported that it’s now only $4.80 a barrel, the lowest in four months, while Indian media claimed that their country is now actually paying a $4-5 premium per barrel.

Addressing the reported premium prices first, India has an interest in snapping up finite Russian supply at sea in order to meet its energy needs before the US’ waiver expires in the event that it’s not extended, ergo why it might have paid more for that. Russia, being driven by market conditions with a view towards replenishing its war chest as much as possible amidst the West’s unprecedented four-year-long sanctions, won’t ever pass up such an opportunity if it’s offered. Both countries’ interests as thus served.

As for why some of India’s reported purchases were at a reduced discount, this too has to do with market conditions after the US waived its sanctions, first for India and then for everyone. It hasn’t been confirmed, but it would make sense if the reduced discounts were in place when only India had obtained that waiver, and then India offered to pay a premium once everyone else was able to buy finite Russian oil at sea without fear of US sanctions. Both countries’ interests would thus once again be served.

What’s most important for observers to know is that neither Russia’s reduced oil discounts and/or India’s purchase of its oil at a premium are political punishment by the Kremlin like a top influencer claimed. Pepe Escobar, whose scandalous claim that India “betrayed” Iran and Russia was recently debunked by both of their ambassadors to Delhi as explained here, also alleged that “Russia is teaching India its own lesson. New Delhi will have to pay dearly for it – as in no more energy discounts”.

His abovementioned conclusion carries with it the innuendo of political punishment on the debunked premise that India “betrayed” Russia. That’s not true as was explained since market conditions are responsible. He was also separately wrong about China benefiting from the war, which he wrote both an article and a tweet about. Global Times, which is under the auspices of the Communist Party of China, then published an editorial sharply condemning popular narratives about China and the Third Gulf War.

These are that China “failed” to protect Iran, it has a “responsibility” for the war due to its close ties with Iran, and it’s the “winner” from the war, the last of which relates to Pepe’s narrative that he wrote about two days prior to their piece and then defiantly tweeted about shortly after it was published. To be clear, Global Times wasn’t responding to him just like the Iranian and Russian Ambassadors to India weren’t either, but these semi-official and official statements debunk what he claimed about their countries.

Everybody gets things wrong, but influencers like him should account for it so as to retain their audience’s trust and learn from their mistakes, which in Pepe’s case are letting his “anti-Zionist activism” and BRICS enthusiasm cloud his analytical judgement. Whether it’s about India “betraying” Iran and Russia, Russia “teaching India its own lesson” as punishment, or China “get[ting] stronger” from the war, he’s been wildly off the mark and hopefully recalibrates his takes in order to restore accuracy to his work.