India has saved around $2.5 billion per year by buying discounted crude oil from Russia since the Ukraine war began in February 2022, according to a report by foreign brokerage firm CLSA.
This figure is much lower than other estimates. Recently, a US treasury secretary claimed India had gained $16 billion, while other media reports suggested the savings were between $10 billion and $25 billion.
CLSA, however, said these numbers are exaggerated. Its analysts calculated that India’s actual benefit is only about $2.5 billion a year, which is just 0.6% of India’s GDP.
India, the world’s third-largest oil importer, has faced global pressure to stop buying Russian oil. If India were to stop, experts warn crude oil prices could rise sharply, possibly crossing $100 per barrel from the current $67 per barrel (Brent).
Since the war began, India’s imports of Russian oil have jumped significantly — from less than 1% of total oil imports to almost 40% now, mainly because of the discounts offered by Russia.
However, CLSA’s report highlights that the real financial benefit for Indian buyers is much smaller than the big discount figures might suggest.
