Whether Israel wins or Iran, Putin will be the real Sultan! America's ploy fails, India is buying Russian oil in droves
The Iran-Israel tensions have sparked fears of higher petrol and diesel prices worldwide. The disruption of sea routes has disrupted oil supplies. But Russia has struck a chord in this crisis! Despite sanctions, demand and prices for Russian oil are skyrocketing. America is helpless, while India is buying heavily. Learn how Russia became the true "Sultan" in this war.
Whenever there's a hint of war in the world, the common man is initially frightened by the prospect of inflation and rising petrol and diesel prices. The current war between Iran and Israel has created similar fears in the global market.
Approximately 20 percent of the world's oil passes through the Strait of Hormuz. Iran's tightening of its grip on this narrow sea route has severely disrupted the oil supply chain.
But amid this global chaos, there is one country whose fortunes have changed overnight.
That country is Russia. While the entire world is in distress, Moscow is rejoicing. What has happened that Russia, once economically isolated by Western countries, is emerging as the biggest economic winner of this crisis?
Sanctions shackles broken, dollars flooding into treasuries
Just a few weeks ago, the situation was completely different. Tough Western sanctions stemming from the Ukraine war had crippled Russia's economy. Countless ships loaded with Russian crude oil were stranded at sea, but they were finding no buyers.
Now, the tables have turned. According to a report in the Financial Times, since the Strait of Hormuz was blocked, Russia is earning an additional $150 million per day.
To stem the skyrocketing oil prices, the US has been forced to relax its own regulations. US Treasury Secretary Scott Bessant clarified that a temporary exemption has been granted to purchase Russian oil stranded at sea.
He argues that this is a short-term measure that will not yield any significant financial benefits to Russia. However, the ground reality suggests otherwise. Russian oil, which was considered "untouchable" until yesterday, is now in high demand.
Brent crude, which sold for around $73 before the war, has now reached $119 per barrel. Russia's Urals crude, which used to be sold at a steep discount, is now selling at a premium.
India is getting diplomatic advantage
This changing global landscape is directly impacting countries like India, which rely heavily on imports for their energy needs. Following the Strait of Hormuz's closure,
Indian refineries have shown pragmatism and rapidly increased their purchases of Russian crude oil. By early March, this figure had jumped to 1.5 million barrels per day, a 50% increase over February.
Interestingly, this time even Washington is not opposing the purchase. Sergio Gor, the US ambassador to India, recently acknowledged that India is a vital partner in stabilizing global oil prices, and that purchasing Russian oil is part of this effort. Until a few months ago, this shift in US stance was considered politically impossible.
Putin's 'masterstroke' with the Dragon
Russia is not only breaking new ground in oil, but also in gas. After losing a major market like Europe, Russia is now regularly shipping LNG to China.
According to a Bloomberg report, China's recent five-year plan includes advancing work on the "China-Russia Central-Route Natural Gas Pipeline" (Power of Siberia 2). This is a major strategic victory for Russia.