Reliance Industries Signs Deal With Rosneft To Buy Oil in Roubles

Reliance Industries Limited, The Indian multinational conglomerate led by Billionaire Mukesh Ambani has a diversified business including energy, petrochemicals, natural gas, retail, entertainment, telecommunications, mass media, and textiles. The Company has signed a deal with Russia’s Rosneft to buy oil in Roubles.

Reliance To Buy Oil in Rubles

Reliance Industries Limited has entered into a significant agreement with Russia’s Rosneft. As reported, the deal stipulates the purchase of at least 3 million barrels of oil per month for a duration of one year, with transactions to be conducted in Roubles- the local currency of Russia. This agreement follows Russian President Vladimir Putin’s initiative encouraging Moscow and its trading partners to seek alternatives to the Western financial system. This strategic move aims to maintain trade operations despite ongoing US and European sanctions. 

How Will This Deal Help RIL?

The term deal with Rosneft allows Reliance Industries to secure oil at discounted rates, which is particularly beneficial as the OPEC+ group of oil producers is expected to extend voluntary supply cuts beyond June. The OPEC+ group includes the Organisation of the Petroleum Exporting Countries (OPEC) and allies such as Russia.

India, one of the world’s largest oil importers and consumers, has emerged as the biggest buyer of seaborne Russian crude since The Western countries halted purchases and imposed sanctions on Moscow after Russia’s 2022 invasion of Ukraine. Additionally, India has also paid for Russian crude in rupees.

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Conclusion: The deal between Reliance Industries and Rosneft signifies a major change in the global oil market due to political tensions and sanctions. By purchasing discounted Russian oil and paying in roubles, Reliance is going to secure a cheaper and steady supply of oil. For India, this agreement is particularly beneficial as the country has become a significant buyer of Russian oil. It ensures that India has a stable energy supply despite the international sanctions imposed on Russia. This strategic partnership helps India navigate the complex landscape of global oil trade and maintain energy security.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.