By Nidhi Verma
NEW DELHI/MOSCOW (Reuters) -Russia’s state oil firm Rosneft has agreed to supply nearly 500,000 barrels per day (bpd) of crude to Indian private refiner Reliance in the biggest ever energy deal between the two countries, three sources familiar with the deal said.
The 10-year agreement amounts to 0.5% of global supply and is worth roughly $13 billion a year at today’s prices. It would further cement energy relations between India and Russia, which is under heavy Western sanctions over its invasion of Ukraine.
Rosneft did not reply to requests for comments.
Reliance said it works with international suppliers, including from Russia, and deals are based on market conditions. The company declined further comment on commercial matters, citing the confidentiality of supply agreements.
The deal comes ahead of the planned visit by Russian President Vladimir Putin to India and after U.S. President-elect Donald Trump said he wants to push Moscow and Kyiv to stop the war as soon as he takes office in January.
Russian oil accounts for more than a third of India’s energy imports. India became the largest importer of Russian crude after the European Union, previously the top buyer, imposed sanctions on Russian oil imports in response to the 2022 invasion of Ukraine.
India has no sanctions on Russian oil, so refiners there have cashed in on the cheaper crude supply. Sanctions have made Russian oil cheaper than rival grades by at least $3 to $4 per barrel.
India’s rising Russian imports have come at the expense of rival Middle Eastern producers. The Reliance-Rosneft deal would represent another challenge for competitors, including Saudi Arabia.
Competition among oil producers for a share of the Indian market is hot because it is one of the fastest-growing energy markets, and is becoming more important as a driver of global demand as growth in top importer China slows.
Under the deal, Rosneft would deliver 20-21 Aframax-sized cargoes (80,000 to 100,000 metric tons) of various Russian crude grades and three cargoes of about 100,000 tons each of fuel oil each month, the three sources said.
The shipments will be supplied for Reliance’s refining complex, the world’s biggest, at Jamnagar in the western state of Gujarat.
Two sources said Reliance and Rosneft will review pricing and volumes every year under the deal to factor in oil markets dynamics.
In 2024, Reliance had a deal with Rosneft to purchase 3 million barrels of crude a month. Rosneft has been also selling crude to Reliance via intermediaries on a regular basis.
