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Checkmate With a Bishop and a Knight: How the Indian Factor Could Be Decisive for the Collapse of the Russian Oil Empire

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Checkmate With a Bishop and a Knight: How the Indian Factor Could Be Decisive for the Collapse of the Russian Oil Empire © depositphotos/3d_generator

In anticipation of Donald Trump's inauguration, the world is increasingly using the words "oil," "sanctions," and "end of war," if not in the same sentence, then at least side by side. The logic here is simple: the Russian Federation receives its main income from the sale of oil and other energy resources, and if these sales are limited or the income from them is minimized (for example, by lowering prices), then the Russian Federation will not have money for war. And, as is well known, waging a war is not cheap at all.

Indeed, the method is historically justified. After all, it is worth noting that it was this approach to making decisions on oil prices that led to the collapse of the Soviet Union at one time. But will this approach work a second time? And most importantly, will the leaders of the world energy market be willing to give up income in order to appease an "aggressive competitor"?

How Russia Disguises Itself To Return Its Oil and Gas to Europe — And How To Stop It
How Russia Disguises Itself To Return Its Oil and Gas to Europe — And How To Stop It

It is no secret that after the introduction of sanctions in 2022, the oil economy of the Russian Federation was saved by the markets of India and the People's Republic of China. However, Russia paid for this “service” with loss of income, selling crude oil to these countries at prices significantly lower than market prices (at the same time, we recall that oil revenues in 2022 were record high precisely because of high prices). According to experts, the discounts that the Russian Federation provided to its two largest buyers reached 20–40% at that time! It is worth noting that we should not forget about the huge logistics costs, because the Russian Federation delivers crude oil to India by sea, using the so-called shadow fleet to circumvent global sanctions.

At the end of 2024, oil from the Russian Federation accounted for more than a third of India's energy imports. Thus, it even claimed to become the largest importer of Russian oil in the world, overtaking the People's Republic of China.

However, recent analysis by the company, which is a leading data and analytics platform Kpler, says that in January 2025, imports from the Russian Federation fell to 1.47 million barrels per day. This is the lowest level in the last year. In addition, it should be noted that the reduction in oil flows from the Russian Federation has forced India to diversify its sources of imports, which should certainly change the global balance of oil supplies in the near future. For example, one of India's largest oil refiners, Bharat Petroleum Corp (BPCL), has announced tenders for the purchase of more expensive grades of oil from the Middle East instead of oil supplies from the Russian Federation. In particular, this concerns the supply of oil from Saudi Arabia, which has already officially announced its intention to increase its oil production. On the other hand, at the end of December 2024, information appeared in the media about the signing of a record agreement between a state-owned company of the Russian Federation called the Public Joint Stock Company “Oil Company “Rosneft” and an Indian private oil refining company Reliance. Thus, the ten-year contract provides for the supply of 500 thousand barrels of Russian oil and petroleum products per day, which approximately corresponds to an amount of up to 13 billion dollars per year. This contract started this January and may not only be valid until 2035, but also be extended for another ten years. The agreement provides for an increase in oil imports from the Russian Federation by the Indian company by almost 70% compared to 2024. According to estimates, this volume is more than 0.5% of the world oil market and reaches up to 50% of Russian oil exports by sea. It is worth noting that at first glance, this agreement seems to be a breakthrough and a victory for the Russian Federation, but this is only at first glance. After all, the conditions stipulated in the contract may, under certain circumstances, turn out to be a trap for the Russian Federation. But first things first…

Nothing personal, just business

From the first days of the full-scale invasion of Ukraine, India has taken a position of complete neutrality with its rhetoric, never once supporting the actions of the Russian Federation and always advocating for a peaceful end to the war. However, in practice, it has not supported sanctions against the Russian Federation and has not provided any assistance to Ukraine. Moreover, it is worth noting that the energy market of this country has turned out to be a real lifeline for Russian oil. After all, even before the war, India bought only 2% of its annual imports from the Russian Federation, and now this figure has exceeded 40%.

It was India that all this time gave the Russian Federation the opportunity to circumvent sanctions. After all, a significant part of the Russian Federation's oil, through processing in India, eventually enters the European market in the form of finished oil products.

Last fall, India’s crude oil exports rose to their highest level since March 2022 as the shutdown of refineries in Europe led to a surge in demand from overseas buyers, including African countries. According to the leading data and analytics platform Kpler, India’s exports to Africa reached a record 380,000 barrels per day.

In addition, it should be noted that the Indian government has repeatedly stated that India will buy Russian oil only as long as it is profitable for it. Moreover, the Indian government has even tried to justify its oil cooperation with the Russian Federation by trying to keep the price down and prevent it from jumping to $200 per barrel.

Why Russian Oil Refining Is a Legitimate Target of War
Why Russian Oil Refining Is a Legitimate Target of War

In general, India’s position is as follows: they say, we have too many of our own problems to solve other people’s. And given that India's interests largely depend on the position of the West and the willingness of the Western market to buy Indian oil products, the decision to cooperate with the Russian Federation may not be final.

It is worth noting that factors such as difficulties with logistics, as well as increased oil production by the United States of America and Saudi Arabia, and a drop in prices on the world market, may very likely push India to reconsider its situational oil partnership with the Russian evil empire.

However, it must be understood that India is not interested in weakening the Russian Federation, because this will change the balance of power in Asia, where it is trying to maintain its status quo. The transformation of the Russian Federation into an appendage of the People's Republic of China with valuable resources increases the risk of aggravation of territorial conflicts for India itself from the same China, as well as Pakistan. However, it is worth saying that political leaders in Delhi will definitely not sacrifice their own economic stability for the sake of saving the Russian Federation. There has already been information that India, following China, plans to stop accepting oil tankers that have fallen under the sanctions of the United States of America against the Russian Federation.

The war is financed not by the "sale" of oil, but by the "income from the sale" of oil

Since it was the record-breaking income from the sale of oil that gave enough strength for the Russian aggression, the reduction in these incomes will obviously affect the military capabilities of the aggressor country. It is worth recognizing the fact that whether we like it or not, the Russian Federation is one of the three largest oil exporters in the world. It is unrealistic to exclude Russian oil from the world market. But it is quite possible to limit the income from its sale.

In November, the volume of oil imports from Saudi Arabia to Asia increased to 5.83 million barrels per day (approximately $ 420 million). This development of events indicates the significant interest of Asian countries, including India, in oil from Saudi Arabia against the background of a decrease in purchases from the Russian Federation.

Saudi Arabia increased its exports to Asia by $ 40 million per day, primarily due to an increase in production to 9 million barrels per day. At the same time, the Russian Federation, faced with restrictions on major markets, reduced supplies to 3.51 million barrels (minus $ 30 million per day), which is the lowest figure since January last year. This creates economically favorable conditions for India and other Asian countries to diversify sources of supply.

False Neutrality Of Russian Science
False Neutrality Of Russian Science

The increase in oil production, which the Saudis are openly talking about, and which Donald Trump is announcing on behalf of the United States of America, will obviously cause another drop in the price of oil on the world market, which, in fact, has been showing a decline for two years in a row. Thus, in order to preserve sales markets, the Russian Federation will have to sell oil even cheaper than before, and therefore, give up profitable income.

And here it is worth returning to the already mentioned “record” agreement between the Public Joint Stock Company “Oil Company “Rosneft” and Reliance. The thing is that this agreement does not fix a specific price for oil. In addition, it is worth noting that according to the document, its value will be adjusted every year, taking into account the dynamics of the Dubai price index. However, the agreement provides for completely fixed discounts from 1 to 3 USD per barrel for all grades of oil and petroleum products. What does this approach mean? It means that in the event of a sufficient decrease in the cost of oil on the world market, this agreement may turn out to be untenable and burdensome for the Russian Federation. Thus, this agreement may become a kind of economic trap for the Russian Federation, when the cost price, taking into account all logistics costs and guaranteed discounts, will practically equal the selling price. That is why the factors of sanctions against the “shadow fleet” of the Russian Federation and the decrease in the price of oil on the world market are of fundamental importance here.

Is the king really naked?

In chess, there is a rather technically complex, but extremely interesting combination of “checkmate with a bishop and a knight” – this is a checkmate of an unprotected king, which is forced with the help of a bishop, knight and king. India could obviously play the role of a bishop in such a geopolitical chessboard layout. But in order to achieve a result, it is necessary to act quickly and in a coordinated manner with the knight and king. In our sense, the role of the Arabian horse can be given to its homeland, that is, Saudi Arabia, and the role of the king can be taken by the United States of America as the leader of the world oil market. However, procrastination in this geopolitical chess combination often leads to a draw, even if there are grandmasters behind the board. And most importantly, for this combination to work, the enemy king must be in the right corner and actually be naked, not just appear to be naked.

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