Putin Touts Energy Ties With China, While India Still Dodges Issue Of Russian Oil Ban

Russian President Vladimir Putin and Chinese President Xi Jinping held a video link call on Wednesday, wherein Putin hailed Russia’s energy relationship with China as “strategic” while emphasizing that Beijing has become Moscow’s top buyer of oil and gas since the Ukraine ‘special military operation’ began.

The timing is the most notable aspect, given the call came just two days after Trump announced he would cut tariffs on Indian goods in exchange for New Delhi halting purchases of Russian crude. Trump also said Washington could lift an additional 25% penalty tariff imposed over India’s energy cooperation with Moscow.

The curious thing is the lack of confirmation of the oil purchase cutoff from the Indian side. As yet, there’s no clear indicator that this key element in the Modi-Trump deal has been ratified. On Wednesday FT reports India hails Donald Trump ‘deal’ but ducks discussing Russian oil ban. The reality remains that there are also technical problems with US crude imports replacing Russian…

“WTI is simply too light to be considered as Urals replacement” for refiners in India following this week’s announcement of a US-India deal on tariffs, June Goh, an analyst at Sparta Commodities said in a note. 

And this is likely why Putin seized the opportunity to tout his energy ties with China. Kremlin aide Yury Ushakov has also reminded the world in a statement to TASS that Russia tops the list in terms of oil and pipe gas supplies to China.

“China continues to hold the first place among our foreign trade partners. Russia is fifth among the countries – trade counterparties of China. The task was set during the talk to take efforts for further development of trade and economic ties, in particular, for example, in the energy sphere. Russia is the top supplier of oil and pipe gas to China,” Ushakov said.

Kremlin estimates say China has purchased more than $230 billion worth of Russian energy since the invasion.

Putin himself in the call acknowledged that bilateral trade saw a “slight decline” last year, including a “correction in indicators,” but insisted Russia remains “among the leaders in energy supplies to China.” He vowed the two will continue to closely coordinate together on a range of issues.

As for the India trade, Reuters reported earlier that Indian refiners have yet to receive instructions to fully stop buying Russian oil and are awaiting a formal government decision. Any official halt would be followed with a transition period, no doubt. Trump’s earlier statements may have been too far out front compared to what Modi actually agreed or said yes to.

Hours after Xi and Putin spoke, President Trump also held a call with the Russian leader Wednesday. They last spoke by ‍phone in late November, at which time a conciliatory Trump praised America’s “extremely strong” relations with China. Xinhua News Agency first revealed the Trump-Xi call, but no further details have been immediately forthcoming.