Why Russia is selling oil at discounted prices?

Russia, the world’s second-largest crude oil exporter behind Saudi Arabia, could potentially sell oil elsewhere, perhaps in China or India. Still, it would probably have to sell it at a steep discount, because fewer and fewer buyers are accepting Russian oil.

Russia is offering oil and other commodities at a heavy discount amid attempts made by the West, including the US and UK, to isolate Moscow through a barrage of economic sanctions. This came following Vladimir Putin ordered Russia's invasion of Ukraine in February.

India could take up the Russian offer of discounted crude oil, according to a Reuters report.

India may take up a Russian offer to buy crude oil and other commodities at a discount in a sign that Delhi wants to keep its key trading partner on board despite Western attempts to isolate Moscow through sanctions, according to a report by Reuters.

India, which imports 80 per cent of its oil needs, usually buys only about 2-3 per cent from Russia. But with oil prices up 40 per cent so far this year, the government is looking at increasing this if it can help reduce its rising energy bill.

The official added that such trade required preparatory work including transportation, insurance cover and getting the right blend of crude, but once that was done India would take Russia up on its offer, as per the Reuters said.

Apart from oil, India is also looking for cheaper fertiliser from Russia and its ally Belarus, according to one of the officials.

Meanwhile, the US has said that India taking up Russia's offer of discounted crude oil would not be a violation of American sanctions.