Russia's Rosneft and India's Reliance Industries, which runs the largest refining complex in the world, have agreed on a one-year contract for the purchase of at least 3 million barrels of oil per month in roubles, four people with knowledge of the situation told Reuters.
The move to rouble payments comes in response to Russian President Vladimir Putin's demands that Moscow and its trading partners look for ways to support trade even in the face of European and American sanctions by finding alternatives to the Western financial system. Private company Reliance is also able to acquire oil at a discount thanks to a term arrangement with Rosneft at a period when the OPEC+ group of oil producers is anticipated to prolong voluntary production curbs past June.
On June 2, an online meeting of the Organisation of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, is scheduled to debate the output restrictions. Since the West stopped buying and placed sanctions against Moscow in the wake of Russia's invasion of Ukraine in 2022, India—the third-largest oil importer and consumer in the world—has emerged as the major purchaser of seaborne Russian petroleum. Additionally, India has paid for Russian oil using Chinese yuan, dirhams, and rupees.
Meanwhile, because they were unable to finalize term supplies for this year, state-owned Indian refiners have been turning to the spot market for Russian oil, as previously reported by Reuters.
The agreement states that Reliance will purchase two cargoes of around a million barrels of Urals oil each month at a discount of USD 3 per barrel to the Middle East Dubai benchmark. The transaction went into effect on April 1 of the current Indian fiscal year.
