The state Corporation “Rosneft” this year for the first time will start a regular supply of oil to India. Thus, according to the Wall Street Journal, “Russia opens a new oil front”.
Buy major stake in Essar Oil from “Rosneft” will allow Russia to create a “small but strategic base” in the Indian market, which is becoming more and more important role among the countries-importers of oil. With this assessment made in the WSJ.
It comes to the purchase of Rosneft’s 49% stake in Essar Oil. It is expected to be completed this year.
Essar Oil owns a refinery Vadinar (the second largest refinery in India), and a network of about 2 thousand petrol stations.
The President of “Rosneft” Igor Sechin has already announced that the deal between Rosneft and Essar, as well as Indian companies buy stakes in oil fields in Eastern Siberia, are “strategic” agreements that strengthen relations between the two countries and enable Russian companies to access the Indian market.
According to some experts, in the future India can catch up with China on oil imports. China annually imports 7 million barrels a day (in February 2016, the imports rose to a record 8 million b/d).
According to the International energy Agency, by 2040, oil imports by India will be about 7.2 million barrels barrels per day (compared to current 4 million b/c).
In the coming years, according to some forecasts, oil demand from India will grow at a faster rate: an average of 4.2% annually over the next 5 years compared to the annual increase in Chinese demand of 3.4%.
Still the largest supplier of oil to India was Saudi Arabia that supplied to 19.7% of the total consumption in the country of oil.
Against the background of falling oil prices Saudi Arabia in the Indian market faced growing competition from Iraq, Iran, Kuwait and Russia.
Start of oil deliveries to the refinery Vadinar from Rosneft in 2016 will mark a new stage in this competition.
