Russia’s state energy giant Rosneft has agreed to supply nearly 500,000 barrels per day of various crude grades to Indian private refiner Reliance, Reuters reported on Thursday, citing its sources. Worth roughly $13 billion a year at current prices, the energy deal is the biggest-ever between Moscow and New Delhi, the outlet said.
Under the ten-year agreement, Rosneft would deliver 20-21 Aframax-sized cargoes (80,000 to 100,000 metric tons) of various Russian crude grades plus three cargoes of about 100,000 tons each of fuel oil each month, according to persons familiar with the matter.
The shipments to Reliance’s giant refining complex at Jamnagar in the western state of Gujarat will start from January. The sides will review pricing and volumes every year under the deal, which has an option to be extended for a further ten years, the sources said.
They specified that the majority of the supply will be medium-sulphur and diesel-rich Russian Urals crude to be priced at a discount of $3 per barrel to Dubai quotes for the following year. Premiums for light sweet grades were set at around $1.50 a barrel for ESPO, the sources said, Sokol at about $2 per barrel and Siberian Light at about $1 per barrel against Dubai quotes for 2025.
The new deal reportedly accounts for roughly a half of Rosneft’s seaborne oil exports from Russian ports and amounts to 0.5% of global supply.
Asked by Reuters for a comment, Reliance said it works with international suppliers, including from Russia, and deals are based on market conditions. The company declined to give any details of commercial matters, citing the confidentiality of supply agreements.
Reliance Industries is a Fortune 500 company and the largest private-sector corporation in India.
According to the report, Reliance had a deal with Rosneft to purchase three million barrels of crude a month this year. The Russian company has been also selling crude to the Indian refiner via intermediaries on a regular basis, Reuters wrote.
The new deal will further strengthen cooperation and energy ties between Moscow and New Delhi.
Moscow’s ambassador to the country, Denis Alipov, said this week that Russia has become the largest oil supplier to India, accounting for up to 40% of the Asian nation’s overall crude imports. Deliveries have doubled last year to $45 billion, according to the envoy.
India, the world’s fifth-largest economy and third-largest importer and consumer of oil, ramped up crude purchases after Russia rerouted supplies to Asia in response to Western sanctions over the Ukraine conflict.