In a strategic move to counteract the tightening supply of Russian crude due to recent U.S. sanctions, Indian Oil Corporation (IOC), India’s premier refiner, has procured 7 million barrels of crude oil from Middle Eastern and African sources.
This procurement includes a notable acquisition of Abu Dhabi’s Murban crude from Totsa, a subsidiary of TotalEnergies, at a significant premium. Additionally, IOC secured various crude grades from Nigeria, Gabon, and Angola through deals with Shell and Chevron.
The shift in IOC’s sourcing strategy underscores the deepening economic ties between India and Africa. Historically, bilateral trade has seen substantial growth, with figures escalating from $5.3 billion in 2001 to $70 billion in 2013. This upward trajectory is anticipated to continue, driven by mutual economic growth and collaborative ventures. 
Africa’s export landscape has also evolved, with a marked pivot towards Asia. By 2021, Asia accounted for over 40% of Africa’s exports and imports, surpassing Europe. Notably, Africa’s exports to India have surged more than elevenfold since 2000, highlighting India’s growing significance as a trading partner.
The recent sanctions on Russia have compelled major oil importers like India to diversify their crude sources. The U.S. sanctions, announced last Friday, are expected to curtail Russian oil supplies to key markets, including China and India, prompting these nations to seek alternatives in the Middle East, Africa, and the Americas.
This strategic realignment not only ensures India’s energy security but also bolsters Africa’s position as a vital player in the global oil market. The increased demand from India and China has driven spot premiums for Middle Eastern crude to their highest levels in over two years, reflecting the dynamic shifts in global energy trade.
Indian Oil Corporation’s recent procurement from African nations signifies a pivotal moment in India-Africa relations. As geopolitical factors reshape global trade routes, such collaborations are poised to strengthen, fostering economic growth and mutual prosperity for both regions.
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