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Donald Trump’s sanctions on Iran force Indian oil minister Dharmendra Pradhan to dial Russia for cheaper oil

Katya Naidu | Jul 4, 2019, 11.55AM IST

  • Indian Oil minister Dharmendra Pradhan spoke to his Russian counterpart, Alexander Novak, to strengthen energy ties between the two countries.

  • Pradhan also urged Russia to play a balancing role in its engagement with OPEC countries by taking into account the interests of consuming countries

  • Pradhan said that India is interested in enhancing footprints in the Russian E&P sector.
If US was earlier worried about growing closeness of India with its arch enemy Russia, it has more to worry about.

The country’s oil minister Dharmendra Pradhan spoke to his Russian counterpart, Alexander Novak to strengthen their energy ties.

Balancing act

“During the telecall, Pradhan conveyed his concern on the growing crude oil price volatility during the last few weeks, and also urged Russia to continue to play a balancing role in its engagement with OPEC countries by taking into account the interests of consuming countries,” the ministry said in a press release on Thursday.

This move comes after US placing sanctions on Iran, and had been trying to force India’s hand over importing oil from the country. That is tough since India buys as much as 10% of its oil from the country. Apart from receiving favourable rates and shipping terms, the quality of Iranian crude bodes well with Indian refining capacity.

Squeezing Iran

Iran and US have been at loggerheads ever since America pulled out of a nuclear deal involving the country. The tensions escalated after Iran threatened to enrich its Uranium to weapons grade by July 7, if US does not lift its since sanctions that are eating into its economy.

US has been stepping up economic sanctions and pressurising nations to cut off oil money, the country’s lifeblood. As India is its second largest oil client after China, getting it into the fold is key.

However, India seems to be in no mood to relent. It is in fact turning to Russia which is known to have its own agenda in controlling oil supplies to Eastern Europe. Indian oil ministry says that both the countries are looking to develop comprehensive engagement plan with a long-term view.

“Pradhan also conveyed India’s interest to further enhance footprints in the Russian E&P sector. He invited Russian oil and gas companies to invest in building gas infrastructure in India and in the expansion of city gas distribution networks,” the press release said.

Oil is only one of the many areas of Indo-Rus ties. India is trying to work a deal with the country to purchase 400 missile defence systems. And, US wants this deal to be scrapped. When US Secretary of State Mike Pompeo was in India for a visit recently, he applied diplomatic pressure on India. But the country’s external affairs minister S Jaishankar made it clear that the government will take a decision which is in its own interests

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