India's Unwillingness on Price Cap for Russian Crude Purchase Leading to Payment Issues'

New Delhi, Feb 22 (IANS) India's unwillingness to agree with the price cap imposed on sale of Russian crude oil has led to payment related difficulties for oil marketing companies like Hindustan Petroleum Corporation Limited (HPCL), industry sources said.

The price cap of $60 per barrel on sale of Russian crude was imposed by the G7 group of nations, Australia and the EU on December 5, 2022, and doesn't allow countries to pay more than $60 per barrel for purchasing Russian oil.

However, sources claim that as India is not willing to follow the price cap, oil marketing companies like HPCL are facing payment issues.

HPCL, reports quoting sources said, is in talks for a term contract with Russia. Currently the oil marketing company is making payments for Russian crude in US dollars, UAE dirhams and Russian rubles, sources said.

The three oil marketing companies namely Indian Oil, Bharat Petroleum and HPCL are facing losses despite softening of international prices, as retail petrol and diesel prices have remained unchanged in the country since May 2022.

Last year in October, the government had given these companies Rs 22,000 crore as one-time compensation to make up for their losses for selling cooking gas at subsidised prices for two years beginning June 2020.