US says India can buy Russian oil outside G7 price cap - Reuters

US Treasury Secretary Janet Yellen has said that India can purchase Russian oil at any price, even above the G7 price cap. This is as long as it stays away from Western insurers, financiers and maritime firms that have to follow the cap.

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Speaking to Reuters, Yellen said, “Russian oil is going to be selling at bargain prices and we are happy to have India get that bargain or Africa or China. It’s fine.”

An unnamed government official was also quoted by Reuters as saying, "I do not think we will follow the price cap mechanism, and we have communicated that to the countries. We believe most countries are comfortable with it and it is in no one's case that Russian oil should go offline.”

A price cap on seaborne Russian oil will be implemented by the group of seven nations, including the US, to limit the country's income from oil exports from 5 December.

According to official sources, the G7 coalition has decided to set a fixed price cap instead of a floating rate and that “the cap will be determined in line with the historical average of $63-64/bbl, a level that could form a natural upper limit.”

Data from cargo tracker Vortexa shows that Russia surpassed Saudi Arabia and Iraq to become India's number one oil supplier in October. Russia now accounts for 22% of India’s total crude imports, ahead of Iraq’s 21% and Saudi Arabia’s 16%.

Meanwhile, Bloomberg reported in August that Russia was contemplating offering a 30% discount on crude oil to Asian nations in order to divert its crude oil sales to Asia.

Indonesia's tourism minister clarified after the reports that Russia offered to sell its oil at a 30% discount to international market prices. Pakistan's finance minister, Ishaq Dar, also expressed interest in purchasing the discounted oil.

By Konica Bhatt

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