Oil pumping cranes work in an oil field near Almetyevsk, Tatarstan, Russia, on Wednesday, March 11, 2020.
Andrei Rudakov | Bloomberg | Getty Images
India’s Petroleum Minister Shri Hardeep Singh Puri said on Monday that the country would carefully assess whether to support the G7 proposal to impose a cap on Russian oil prices.
“There are a lot of conversations going on because of a plethora of factors,” CNBC’s Hadley Gamble said at JASTIC 2022 in Milan, Italy.
Asked if India would agree to the G7 proposal to cap the price of Russian oil, Puri said the global economy was still adjusting to the impact of the coronavirus pandemic and Russia’s invasion of Ukraine.
“Now, what does the proposal mean? We will consider it very carefully,” he said.
Puri added that it was still not clear which countries would participate in the proposed cap on Russian oil prices and what potential effects it could have on energy markets.
Finance ministers representing the G7 countries on Friday It approved a plan to implement the mechanism for setting the price ceiling for Russian oil exports.
The initiative is designed to limit the Kremlin’s ability to fund its offensive in Ukraine and better protect consumers amid rising energy prices.
Energy analysts were highly skeptical about the impartiality of the proposal, however, warning that the policy could backfire if major consumers such as China and India did not participate.
China and India increased their purchases of Russian oil in the wake of the Kremlin’s invasion of Ukraine, taking advantage of discounted prices.
Puri said India consumes about five million barrels of oil per day and most of it comes from Iraq, Saudi Arabia, Kuwait and the United Arab Emirates.
Puri said that Russia accounted for only 0.2% of India’s oil imports at the end of March, noting that some have criticized India for increasing its supply of Russian oil in the wake of the Kremlin invasion.
“I said that Europeans buy more in one afternoon than I do in a quarter. I would be surprised if this is not the condition yet. But yes we will buy from Russia and we will buy from anywhere,” Puri said.
When asked if he has a moral conflict with buying Russian oil amid the Kremlin’s offensive in Ukraine, Bouri replied, “No, there is no conflict. I have a moral duty to the consumer. Do I as a democratically elected government want a situation where the oil is? Is the pump running dry? See to what happens In countries around India. “
The European Union has He invited China and India to participate in the G7 initiative To reduce the profits that Russia reaped from the sale of oil.
European Energy Commissioner Cadre Simpson told CNBC’s Silvia Amaro on Saturday that China and India “are willing to buy Russian oil products while excusing themselves that this is important to the security of their supplies. But it’s not fair to pay excess revenue to Russia.”
It is not yet clear how the G7 will implement its price-setting plan. Details are expected to be settled before early December, when the European Union begins sanctions on seaborne imports of Russian crude.
The G7 consists of the United States, Canada, France, Germany, Italy, the United Kingdom, and Japan.
Russia on Monday vowed to take retaliatory measures over the proposal and said it would stop selling oil to countries that impose price ceilings on Russian energy exports.
French Finance Minister Bruno Le Maire told CNBC on Saturday that efforts to cap the price of Russian oil require widespread international commitment to succeed.
Rather than just a Western action, Le Maire said the initiative should be implemented as “A global scale against war.“
CNBC’s Silvia Amaro contributed to this report.
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