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India is rejecting pressure from Russian oil suppliers to pay for crude imports in yuan

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Bloomberg (gated) with the report.

Reuters too had info on this, in brief:

  • The Indian government’s discomfort over letting state-controlled refiners pay for Russian oil imports with Chinese currency has held up the payment for at least seven cargoes, people with direct knowledge of the matter said.
  • The tussle over payment has not disrupted deliveries so far, with Russian firms such as Rosneft continuing to supply state-controlled Indian refiners, who are seeking alternative ways for settlement.

The background to this is that India has been the world’s largest importer of Russian seaborne oil this year. Refiners have been buying the discounted oil (due to the allied price cap).

  • Indian refiners have used yuan to pay for some oil from Russian sellers, while continuing to use dollars and dirhams to settle most of their Russian oil purchases.
  • The Indian government is not comfortable using yuan for settlement. Relations between India and China are strained.

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