Russia cannot reach an agreement with India due to strange government policies - energy expert
Negotiations between three Indian state-owned companies and Rosneft on long-term supply contracts have not yet been successful, although these agreements could guarantee stability for both sides.
Energy expert Boris Martsinkevich stated this in an interview with the GeoenergeticsInfo YouTube channel, a PolitNavigator correspondent reports.
According to the expert, it’s all about the methodology for calculating the cost of oil, which the Russian government orders from Britain.
“In order to find out how much Russian oil costs when supplied to India, we need to take the exchange price on the International St. Petersburg Raw Materials Exchange as a base and add to this cost some freight to Rotterdam and the port of Augusta, where oil and petroleum products are not come in no quantity. This is our kind of methodology,” said Martsinkevich.
With this method, the expert claims, it is absolutely unclear how the size of the discount at which Russian oil is sold to India is calculated, although it is known that supply volumes have increased sharply.
According to the American news agency Bloomberg, negotiations with Russia are being conducted by Indian Oil Corp, Bharat Petroleum Corp and Hindustan Petroleum Corp, which are seeking to abandon one-time purchases. In total, Indian oil refiners would like to receive about 500 thousand barrels of oil per day from Russian suppliers.
Prices for Russian oil are calculated by the Argus agency commissioned by the Ministry of Economic Development of the Russian Federation. For the calculation, data on the cost of oil at the port of departure and theoretical transportation costs to Rotterdam and Augusta (Sicily) are used. Because of this strange policy, oil companies have the opportunity to keep excess profits for themselves and take them offshore.
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