US Treasury Chief Accuses India Of Profiteering $16 Billion On Russian Oil

US Treasury Secretary Scott Bessent has accused India of making billions in profits from cheap Russian oil imports.

In an interview with CNBC on August 19, Bessent said Russian crude now makes up 42 percent of India’s total oil imports, a sharp increase from less than 1 percent before Moscow’s full-scale invasion of Ukraine in February 2022. By comparison, China’s share of Russian oil imports only grew slightly during the same period, from 13 percent to 16 percent.

Bessent claimed India was engaging in what he called “Indian arbitrage”, buying discounted Russian crude, refining it into fuel, and then selling the products such as gasoline and diesel to markets that had sanctioned Moscow, including Europe. He described the practice as “unacceptable” and said it had generated around $16 billion in excess profits for some of India’s wealthiest families.

Energy consultancy Kpler reported that India imported 1.5 million barrels per day (bpd) of Russian oil in July, making it Russia’s largest customer. China, which was already a major buyer before the war, imported about 1 million bpd in the same month.

Earlier in August, President Donald Trump announced an additional 25 percent tariff on Indian goods, raising the total additional duties on Indian exports to 50 percent since he took office. The new tariffs take effect next week and are intended to punish India for continuing large-scale purchases of Russian oil.

Bessent’s comments came a day after White House trade advisor Peter Navarro made similar claims. In the Financial Times, Navarro said India’s purchases of Russian energy were “opportunistic” and harmful to global efforts to isolate Moscow. He argued that while Russia continues to attack Ukraine with India’s financial support, the U.S. and Europe are spending tens of billions to defend Ukraine. He added that over 300,000 soldiers and civilians have died since the war began, and NATO’s eastern flank is now more at risk.

Navarro also accused India of blocking U.S. exports with high tariffs and trade barriers. He supported what he called a “two-pronged policy”, limiting India’s access to U.S. markets and pressing New Delhi to cut oil imports from Russia. He added that if India wants to be treated as a U.S. strategic partner, it must start acting like one.

India has defended its Russian oil imports as essential for ensuring energy security and dismissed the US tariffs as “unreasonable” and “unjustified,” pointing out that both the US and Europe continue to trade with Russia in some energy and raw material sectors. New Delhi has also refused to open its agriculture, dairy, and micro, small and medium enterprise (MSME) sectors to greater US market access.

In a limited gesture, India temporarily suspended its 11 percent import duty on cotton until September 30.

References: channelnewsasia, cnbc

Source: Maritime Shipping News